7 Places That Don’t Tax Crypto

As you add cryptocurrency to your portfolio, you may want to consider what country you’re doing your investing in. Not all areas of the world are the same when it comes to how they handle tax laws for crypto, and choosing wisely could earn you larger gains. Residential requirements also differ, but the savings could be beneficial if relocation isn’t an issue. Check out these crypto-friendy tax havens to boost your investment strategy.

The Caymans have long been known as a tax haven for businesses, and they’ve become a safe place for cryptocurrency investors as well. It’s a “tax neutral territory,” which includes 100% exemptions on corporate taxes, capital gains taxes, and income taxes — and that includes any profits you make in cryptocurrency markets. There are residency requirements, yet also the potential to hold crypto in an offshore trust.

The island nation also established the Blockchain Association of the Cayman Islands to promote its crypto-friendly policies, which may be a good resource for potential new investors.

If you want to pay zero taxes on the crypto you buy and sell, Portugal could be an inviting option. The European country has been very friendly to cryptocurrency investors with its 0% tax rate on crypto transactions. Residential requirements are also easier to meet than for other countries, which means you could have a smooth transition to take advantage of this tax haven.

Even though Puerto Rico is a United States territory, its tax laws operate differently than the mainland U.S. regarding cryptocurrency. Investors can get their tax rate down to 0% on their cryptocurrency investments if they meet certain criteria. And for U.S. investors, there’s no need for a visa or a passport to make the move to Puerto Rico, but residency is required.

One of the big factors to consider when dealing with cryptocurrency taxes for established German residents is the length of time you hold on to your investment. Your profits will be tax-free only if you hold onto your crypto for more than a year. Note that this only applies to personal investments. Any profits from the sale of cryptocurrency held by a business will be subjected to corporate taxes.

This small nation has taken on the title of “Blockchain Island” to entice cryptocurrency investors. The tax code does have detailed rules, so residents of the country need to navigate regulations correctly. In particular, crypto investors may have to pay attention to how long they’ve held the currency and the difference between Malta’s definition of coins and tokens. A wrong move could mean a 35% tax rate on gains. If structured correctly, investors may pay less than 5% in taxes.

Switzerland is known as a tax haven in general, and cryptocurrency is no exception. If cryptocurrency is part of your personal wealth, you may not have to pay capital gains taxes on it in Switzerland. But there are some criteria that need to be met for your investment to be tax-free, including how long you’ve held the cryptocurrency and whether you’re a resident. Also, if you hold crypto as a self-employed investor or for a business, tax laws could affect your earnings differently.

Singapore has no capital gains tax for both individual and business holders of cryptocurrency who reside in Singapore. Businesses can also accept crypto as payment for services, but they will likely have to pay income taxes on that. The good thing is that crypto is considered a form of currency and accepted by businesses such as ride-sharing services and cafes in the country.

If you’re serious about investing in cryptocurrency, scouting a place to invest from may be a good idea to avoid cryptocurrency taxes. Not all countries are as crypto-friendly as the ones on this list. Remember that some countries may require you to be a resident before you can take advantage of the tax benefits.

One of the surprising facts about cryptocurrency is that there are some countries that have actually banned its use as currency or won’t allow even the best cryptocurrency exchanges to operate within their borders. If you make the right choice, a tax haven could be the perfect place for your budding cryptocurrency investments.