Taxes 2022: how to declare your cryptocurrencies to the tax authorities?

The tax declaration campaign for 2022 has been open since April 7. Since 2019, cryptocurrencies are considered digital assets. If the mere holding of a portfolio does not necessarily have to be declared, the capital gains derived from the sale of these assets are on the other hand subject to tax and must be declared to the tax authorities. Explanations.

When a taxpayer holds cryptocurrencies, they are said to hold a digital wallet. If this digital wallet is managed by French companies or companies domiciled in France, it is not necessary to declare all the assets it contains for tax purposes. On the other hand, if this portfolio is opened on a foreign exchange platform, it is imperative to inform the tax authorities, regardless of the amount of what it holds. In this case, a digital asset account declaration must be completed using form no. 3916 for each portfolio. Otherwise, the taxpayer is liable to a fine of 750 euros per undeclared account.

Capital gains taxed at 30%

However, not all declarations are synonymous with taxation. If the assets held in an account have never been transferred and have not given rise to any financial gain, they will not be subject to tax. It is for example possible to exchange cryptocurrencies between them (for example to buy ethereum with bitcoin) without being taxed. However, when a conversion into a currency (euro, dollar, etc.) is carried out, the tax authorities consider it as a financial gain and the transaction falls under income tax.

The General Tax Code (CGI) provides that income from the sale of cryptocurrencies is subject to the single flat-rate levy (PFU) if it exceeds 305 euros over the year. In other words, they are taxed at 12.8% to which are added social security contributions to reach a total of 30%. To declare this income, it is therefore necessary to include the amount of these transactions in boxes 3AN and 3BN of the main form n°2042 and complete annex n°2086 with all the information concerning the disposals and acquisitions of digital assets.

Mining also taxed

Finally, the mining of a cryptocurrency, that is to say the verification of the validity of a transaction carried out with a cryptocurrency can also generate income. In return for this task, exchange companies offer financial compensation. Like all capital gains, if this compensation is converted into currency, it becomes taxable.

In the event of non-declaration, the CGI provides for a fine of up to 1500 euros. A breach or an error not corrected within thirty days of the declaration may lead to a tax increase of up to 40%. In the event of fraud, the surcharge can rise to 80%.

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