Taxation of private person’s crypto earnings in Estonia

What you need to know if you have your income coming from the virtual currency in Estonia.

Purchase, sale or exchange

According to subsection 15 (1) of the Income Tax Act, virtual currency is considered property. Income tax is charged on earnings from the transfer of virtual currency, including exchange (subsections 15 (1) and 37 (1)).

Mining

An individual who independently deals with cryptocurrency mining and does not pay income tax, then a private person has to declare his income as business income and pay taxes.

Renting out the cloud storage capacity

Gains received from renting out the storage capacity of a private person’s computer must be declared as rental income. If cryptocurrency mining and renting out storage capacity is a business activity, the income from such business has to be declared according to the government regulation.

Salary in virtual currency

All employers paying salary in virtual currency within Estonia have to convert it into euros according to the market price and pay labour taxes before making payments to employees.

VAT

Exchanging virtual currency for traditional payment method is exempt from VAT. Consequently, if an individual is dealing with cryptocurrency, he doesn’t need to register a VAT number.

Medium account for the Company in Estonia OÜ; a team of professionals assisting in formation and developing business in Estonia.