Key takeaways:
- The Supreme Court of Denmark has decided that profits from the sale of Bitcoin (BTC) are taxable.
- Investments in the nation’s significant digital assets are uncertain and are susceptible to the country’s Tax Act.
The Supreme Court of Denmark has decided that profits from the sale of Bitcoin (BTC) are taxable. This decision was made by the top court in two of the cases that were brought before it and was made on March 30.
The Danish Supreme Court has decided that Bitcoin earnings are taxable as the fiscal year draws close. The Supreme Court in Copenhagen ruled on Thursday, March 30, that the conclusions reached by the lower courts that holding digital currency are speculative were maintained. One case involved the profits from the sale of Bitcoin that had been purchased, whereas the other involved the sale of digital currency that had been generated. The judge declared:
“The Supreme Court assumes that Bitcoin are generally only acquired with a view to being sold and, to a limited extent, to be used as a means of payment.”
In the first instance, the owner acquired their Bitcoin holdings between 2011 and 2015 and got some as gifts. In 2017 and 2018, the holder would subsequently resell these properties for a profit. In the alternative scenario, the BTC was obtained between 2011 and 2013 through mining operations and was subsequently sold for a profit in 2018. The court determined that the Bitcoin sales’ profits were not tax-exempt in both instances.
According to a statement from the Supreme Court, investments in the nation’s significant digital assets are uncertain and are susceptible to the country’s Tax Act. The court further determined that the BTC constituted revenue in their non-business operations when obtained as gifts or through mining. Gains generated by these businesses “trigger tax liability.” The amount of tax to which the gains were subjected was not decided by the judge.
In the meantime, Denmark is not the only nation enacting the cryptocurrency gain tax within its borders. A 26% capital gains tax on crypto-asset trading of over 2,000 euros was passed by the Italian Senate. The taxation of a private cryptocurrency investor’s gains was also determined by a German judge.
The tax rate, however, has not yet been determined. The current resistance level for Bitcoin (BTC) is $28,733, and the current support level is $28060. Before falling again, the original cryptocurrency momentarily surpassed the $29,000 level. But BTC is now at its best point since June 2022.
