22 Apr Trading in stock or crypto currencies | Here’s What You Need to Know About Your Tax Requirements
Trading in stock or crypto currencies and worried about your tax?
The recent stories of how a bunch of Redditor pumped up the stock price of Gamestop or news about bitcoin and its rising popularity might have got you to google “how to buy bitcoin in Ireland?” or “share trading in Ireland “
With instant access to spot trading platforms such as eToro, Coinbase, Trading 212, Plus 500, Robinhood, and Binance; trading and investing in cryptocurrencies or stoke shares have become very popular. With plenty of time around, there is no better time to start investing in your favorite share or cryptocurrency.
But have you thought about your tax liability incurred on trading in crypto or shares? Well! here is a quick guide to help to navigate through your tax liabilities in Ireland.
Although the Irish tax regulations do not provide a clear distinction between trading and investing; the frequency of transaction, ownership, motive, risk, and commerciality are some of the factors that can determine the nature of your liability.
If you have made a profit through your investments
If you are earning profits on your cryptocurrency or share market investments, then you are required to file a Capital Gain Tax with the revenue.
The current rate for which Capital Gain Tax (CGT) is charged is 33%. CGT is only charged for the amount that is earned (i.e. selling price less buying price) from the disposal of an asset. If the income earned is less than €1,270; filing CGT is not required.
The time frame for filing your CGT can be divided into two stages i.e.: –
- If the sale is incurred between 1st January and 30th November, then CGT needs to be filed by 15th December in the same year.
- If the sale is incurred between 1st December and 31st December, then CGT needs to be filed by 31st January next year
In case you are receiving any dividends or interests on your investment then you are required to file your Income tax as well. The extra income earned will be taxed under the Income tax rate as set by the Revenue which includes USC and PRSI.
If you incur a loss through your investments
Stock market and cryptocurrency trading being a very volatile markets, the element of risk is extremely high. Therefore, incurring loss on your investments in very natural.
The loss incurred on your investments can be utilised to offset your capital gains for the current period of in the near future.
If you are engaged in mining crypto currencies
The income earned through mining activities is subject to Income tax as it is considered a trading profit. Mining activities are also excluded from the scope of VAT.
However, the cost incurred on acquiring the equipment’s can be used for an offset against the trading profit.
HOW WE CAN HELP YOU?
Trading and investing can be an incredibly stressful task due to high price volatility. So is attending to your tax liability.
Whether it is crypto trading or stock trading we are here to help you with your tax so that you can give your full focus towards managing your investment portfolio and plan your next speculations.
WHY CHOOSE US?
- Professional Accountants
- From only €150 plus VAT
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- GDPR Compliant
- 100% Ireland based
- Experts in CGT filing