The Securities Commission of Ukraine told how to declare cryptocurrency
Date: 2023-07-25 Author: Karina Ziganova Categories: BLOCKCHAIN, CRYPTO PAYMENTS
If the draft law on crypto taxation is adopted in Ukraine, then citizens will have to report annually on their cryptocurrency savings
Ukrainians will have to collect primary documents to confirm the details of the purchase and sale of cryptocurrency if the Verkhovna Rada approves the draft law on taxes for cryptocurrencies. Yuriy Boyko, a member of the National Securities and Stock Market Commission (NSSMC), spoke about this in an interview with Delo.ua.
If the law on taxation of cryptocurrencies comes into force on January 1, 2024, then citizens of Ukraine will have to submit declarations on their crypto portfolios in 2025 (by the end of 2024). The declaration must indicate:
where, when and how the cryptocurrency was bought;
how much was spent on the purchase of cryptocurrency (it is not clear here whether it is necessary to transfer expenses to hryvnia);
where, when and what income is received from the sale of cryptocurrency.
At the same time, Boyko admitted that Ukrainians may have problems on this issue. However, he argues that over time, the declaration process will become more understandable, since crypto exchanges will have to prepare their services for local legislation.
"If crypto market participants want to continue working, they will be required to adapt their business processes to the requirements of the law," Boyko said.
Citizens of Ukraine who are outside the country after February 24, 2022 will need to decide for themselves whether they are tax residents of Ukraine, says Boyko. To do this, he advised to check with the Tax Code of Ukraine. From the words of Boyko, it follows that the presence of a citizen of Ukraine abroad is not a basis for non-payment of taxes on cryptocurrencies:
"So, if a person is a resident of Ukraine, he will declare virtual assets and pay taxes. And the fact that he is abroad does not change anything for such a citizen. If a person has become a resident of another state, he must comply with tax rules in another jurisdiction.
Recall that Ukraine may legalize cryptocurrency as early as September 2023 by introducing an 18% tax on investment profits and a military levy of 1.5%. The tax rate will be applied to the difference: if the investor invested ₴10,000, and at the end of the investment the amount increased to ₴11,000, then the increase in the amount of ₴1000 will be taxed.
The founder of the first cryptocurrency exchange in Ukraine, Kuna, Mikhail Chobanyan, doubts the expediency of such a high tax. As he noted in his Telegram post, there is no point in discussing "even hypothetically a tax rate of more than 5%," taking into account the military situation in Ukraine.
