Portugal has long been considered a crypto-friendly destination, but since 2023, changes in tax law have rewritten its fame. With growing crypto use and global regulatory convergence, especially within the European Union, Portugal has established more precise taxation guidelines for this type of asset.
The Shift in Portugal’s Crypto Tax Policies in Portugal
What Changed in 2023?
Before 2023, Portugal was famous for its 0% crypto tax policy on capital gains from converting crypto assets into fiat currency. However, this changed in late 2022 when the Portuguese parliament approved the State Budget law, leading to the taxation of cryptocurrencies and the corresponding reporting obligations.
Crypto Taxes in Portugal in 2025: Types of Income and Their Tax Implications
Capital Gains (conversion of crypto into fiat)
- Cryptocurrencies held < 1 year: Taxed at progressive rates (14.5%–48%)
- Cryptocurrencies held > 1 year: Exempt from tax (for personal investors)
Mining Income
- Treated as business income if conducted regularly
- Subject to social security contributions and income tax
Staking and Yield Farming
- Treated as investment income
- Taxed under general income rules if not classified as a business activity – currently at a flat tax of 28%.
Who Is Affected by the 2025 Crypto Tax Rules?
Residents
- Taxed on worldwide crypto gains
- Must report all crypto sales
Non-Residents
- Taxed only on gains from Portuguese sources
- May benefit from double taxation treaties
Crypto Taxes in Portugal 2025: Record-Keeping and Reporting Obligations
Crypto transactions must be reported in the annual Personal Income Tax (IRS) return, which is filed between April and June.
Taxpayers must keep accurate records, on a FIFO basis and per exchange, of the transaction history, the wallet addresses, the exchange records and the fiat-to-crypto conversion rates; for this purpose, taxpayers ought to consider using specialized software like CoinTracking or Koinly to track transactions accurately under the FIFO method. It’s also important to document every transaction.
Crypto Taxes in Portugal in 2025: Audits
The Portuguese tax authority now uses, among others, blockchain analytics, Exchange data-sharing agreements and randomized audits. Audits may be triggered by several red flags, such as large unexplained inflows, frequent transactions, and offshore (tax haven jurisdictions) based exchanges.
Crypto Taxes in Portugal 2025: Conclusion
In conclusion, Portugal’s evolving crypto tax landscape demands that investors remain informed and proactive. With the introduction of more nuanced tax rules and enhanced reporting obligations, individuals and businesses alike must adopt diligent record-keeping practices and stay updated on regulatory changes. As the global cryptocurrency environment continues to mature, understanding and adapting to these policies will be crucial for compliance and optimizing tax outcomes. Investors are encouraged to seek professional advice, like us at Madeira Corporate Services, and use reliable tracking tools to navigate the complexities of crypto taxation effectively in 2025 and beyond.
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