1. Cryptocurrencies
Belgian income tax implications
Hendrik Putman
16 March 2019

2. Taxation as a rule?
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3. The Belgian income tax code (BITC)
The BITC is not specifically adapted to cryptocurrencies. Categories of income defined as taxable in Belgian individual income tax:
1. Real estate income
2. Movable income
3. Professional income
4. Miscellaneous income
 Professional income: Income from a professional activity (repetitive, connected activities for which you receive compensation)
• Taxation 25 % - 50 % on net basis
 Miscellaneous income: Profit from occasional activities, investments or services, not relating to the taxpayer’s professional activities
• Taxation: In principle 33% on the gains (with specific rules for losses)
Cryptocurrencies: Belgian income tax implications
© MYTHRA 2019
Taxation as a rule?

4. Income from cryptocurrencies always taxable in a Belgian context?
 Professional income (Taxation 25 % - 50 % on net basis): Most extreme cases
• → Mining
• → No other professional activity
• → Quick trade (e.g. day-trading)
• → Large amounts & complex organization
 Miscellaneous income (Taxation 33% on the gains): Majority of the cases?
• → Speculative motive
• → Repetition
• → Investing through an automated process
• → External financing
• → Scalping and arbitrage
• → Presence in the community
Difficult follow-up since every conversion (even crypto to crypto) can result in a (taxable) gain: ‘realization of income’
Taxation as a rule?
Cryptocurrencies: Belgian income tax implications
© MYTHRA 2019

5. Income from cryptocurrencies always taxable in a Belgian context?
 Non-taxation :
• → Buy & Hold (+ possibly trending)
• → Risk spreading/ portfolio diversification
• → Hardware wallet (e.g. TREZOR or KeepKey)
• → Savings fund (periodic returns)
Classic criterium: “the normal management of a private estate”:
• Managing your estate as a ‘bonus pater familias’
• Avoiding high risk speculation
• The intention as well as the investment itself
Taxation as a rule?
Cryptocurrencies: Belgian income tax implications
© MYTHRA 2019

6. Corporate income tax is different
 Standard flat rate of 29.58% (25% as of 2020)
• → For SMEs: up to EUR 100k: 20%
• → Non-taxation is not possible, but higher level of certainty
• → Tax leakage upon cash extraction to shareholder
• → In practice: difficult accounting
 Other jurisdictions?
• → E.g. Switzerland
• → Concept of tax residency
Corporate income tax versus personal income tax
Cryptocurrencies: Belgian income tax implications
© MYTHRA 2019

7. Anticipating fiscal
consequences
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8. Cryptocurrencies:
Belgian tax implications
Anticipating fiscal consequences
© MYTHRA 2019
Taxation Risk
High Risk
Ruling
miscellaneous
income
Defense paper
miscellaneous
income
Relocation
Medium/low Risk
Ruling non-
taxation
Defense paper
non-taxation
Decision tree

9. Cryptocurrencies:
Belgian tax implications
Anticipating fiscal consequences
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Bitcoin-tool: https://mythra.be/bitcoin/

10. Cryptocurrencies:
Belgian tax implications
Anticipating fiscal consequences
© MYTHRA 2019
Anticipatory actions
 Feasibility of a ruling
• Ruling commission reluctant to decide on non-taxation
(To date, only one successful ruling published)
• Partial taxation of the gain as an alternative?
 Relocation
• Feasibility (based on personal situation)
• Tax abuse?
• Identification of the jurisdiction of preference
 Other considerations
• Defense file as minimum protection
• Donation of the Cryptocurrency prior to realization
• Valuation of the gain (LIFO, FIFO, Average)

11. Cryptocurrencies:
Belgian tax implications
And what if you are too late?
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Tax regularization
 Correction of historic (incorrect) tax returns
 Questions from banks with respect to AML
 Legal certainty
 Immunity from criminal sanctions

12. Contact information
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13. Contact information
© MYTHRA 2019
Hendrik Putman
Partner
hendrik@mythra.be
+32 53 89 35 64
13

14. 14© MYTHRA 2019
Parklaan 187
9300 Aalst
info@mythra.be
www.mythra.be