Our valued sponsor

Crypto taxes and farming + moving to Portugal

Hello!

I have a kind of difficult situation I would like to fix, and I write here because I think this is the best place I have found all over the Internet to clarify my doubts!


So I live in Spain and have some decent crypto money I made over the last years by playing poker (had a staking deal and got paid in crypto).

Over the last year it has grown a little bit and I know regulators are coming for Defi, so I want to make it clean as soon as possible. The problem is I cannot justify the origin of it. No receipt, nothing. My staker was an Asian guy whose real name I never knew.

And also I would like to minimize the taxes I end up paying.


I farm on a daily basis. I move it around searching for good yields, etc. It provides a good daily source of income I can compound to my savings. I don't have other job.




My idea was moving to Portugal (weather is nice and very close to Spain) and declare it at 0%.

Problem is I don't have another source of income that I can have as a main source of income, so crypto/farming is definitely my main source of income. I make thousands of small trades across DeFi at the end of the year.


I have thought of a few possibilities, but would appreciate help:

-Staying in Spain and declaring (and paying) taxes. Problem is justifying source of income, plus in Spain you pay for crypto to crypto sell, so it's really difficult to even properly pay taxes correctly.

-Move to Portugal and pay as a professional trader and pay whatever taxes. Not sure if it's even possible or how much would I pay.

-Move to Portugal and create a legitimate something that I can count as my main occupation.

-Move to Portugal and find... a loophole to declare and pay 0% taxes.

-Move to another country. I'm kind of adverse to move to another country (would never move to a cold one like Germany) but I'm open to listen to advice and see if there are another possibilities. I have heard about Malta or UAE, Cyprus,...


Well that's it, hope you guys can share some light!
 
Move to another country. I'm kind of adverse to move to another country (would never move to a cold one like Germany) but I'm open to listen to advice and see if there are another possibilities. I have heard about Malta or UAE, Cyprus,...
You should definitely not move to Germany. Not because it's cold but because they will tax the hell out of you. Only crypto that just sits there for over a year and does nothing (no farming, no yielding) is tax free.

I haven't been in the UAE but from what I read this might be the best options for saving on tax. I don't know if I would want to live there but just for the tax it sounds fantastic. Cyprus and Malta need a company setup but then have decent taxes. I'm looking into countries with territorial taxes like Thailand and Philippines for myself. But there are not many infos about Defi and those countries.

But I don't know if you have to show proof where you got them. It could be a problem in general when you try to cash out at any bank. From what I read, as soon as you want to move out a decent amount they want to have proof ...

I would also be careful with Portugal. Yes there is this lawyer / tax advisor on this famous Crypto Youtube channel saying everything crypto related is tax free, but she's admitting that it is a really grey area. So I'm not counting on that and try to setup something legal
 
Hello!

I have a kind of difficult situation I would like to fix, and I write here because I think this is the best place I have found all over the Internet to clarify my doubts!


So I live in Spain and have some decent crypto money I made over the last years by playing poker (had a staking deal and got paid in crypto).

Over the last year it has grown a little bit and I know regulators are coming for Defi, so I want to make it clean as soon as possible. The problem is I cannot justify the origin of it. No receipt, nothing. My staker was an Asian guy whose real name I never knew.

And also I would like to minimize the taxes I end up paying.


I farm on a daily basis. I move it around searching for good yields, etc. It provides a good daily source of income I can compound to my savings. I don't have other job.




My idea was moving to Portugal (weather is nice and very close to Spain) and declare it at 0%.

Problem is I don't have another source of income that I can have as a main source of income, so crypto/farming is definitely my main source of income. I make thousands of small trades across DeFi at the end of the year.


I have thought of a few possibilities, but would appreciate help:

-Staying in Spain and declaring (and paying) taxes. Problem is justifying source of income, plus in Spain you pay for crypto to crypto sell, so it's really difficult to even properly pay taxes correctly.

-Move to Portugal and pay as a professional trader and pay whatever taxes. Not sure if it's even possible or how much would I pay.

-Move to Portugal and create a legitimate something that I can count as my main occupation.

-Move to Portugal and find... a loophole to declare and pay 0% taxes.

-Move to another country. I'm kind of adverse to move to another country (would never move to a cold one like Germany) but I'm open to listen to advice and see if there are another possibilities. I have heard about Malta or UAE, Cyprus,...


Well that's it, hope you guys can share some light!
Hi - you could transfer your crypto to a company outside your place of residence and therefore together transfer out your issues (taxation of your defi/crypto transactions, being unable to declare source of income), to a jurisdiction that would treat them more favorably. You can then recieve income in the form of dividend or otherwise. You dont necessarily need to leave your country but you should ensure some protective measures against your country's anti avoidance rules, by planning properly and creating enough substance.
 
In Portugal, you are going to pay taxes for your trading activities (as it is your main professional activity) and for what you get playing poker (if you still do this). If you don't declare this income the revenue office might never bother you, but this is a risky bet I guess.

Send me a PM and maybe I can help you out.
 
I think what you are willing to achieve might be easy through purchasing/selling NFTs linking a KYCed account with some funds to start, I wouldn't move to Portugal if you don't have any other source of income since crypto traders are paying up to 45% if I'm not wrong.