Topic: Would We Pay Taxes When We Don't Exchange Bitcoin for Fiat Anymore? (Read 465 times)

As many have already said, it depends from country to country. However, if cryptocurrency is already legal in that specific country then I am sure the government of that country will find a way to ensure that it will fall under their tax laws. Taxes are vital for the government as it is needed for their projects and for the finance of the government. However, it still depends on how strict and dependent the country is on taxes.

I don't understand why should someone pay taxes on capital gains from Bitcoin. I mean, just use decentralized P2P exchanges, slightly shut your mouth and don't act like you are a cool guy who doesn't pay taxes, you are not a Robert Kyosaki. If you never mention that you own crypto and if you exchange them P2P through DEXs, then I don't really understand how can someone prove that you are avoiding taxes. P2P exchange can happen for any reason, let's say your friend gave you money as a gift, what's wrong?

Or if you have some money, you may be able to become a citizen of country where you won't have to pay taxes on crypto gains and that won't be hard, things are never done as written. I sometimes laugh when people say you need job visa that's very hard to get to come in Europe, c'mon guys, how do you think these emmigrants from all over the world come here and work unskilled jobs? There are loopholes that everyone knows, these loopholes are intentionally left.

In some countries where crypto is taxed like the US, you’ll likely be taxed once you convert crypto to fiat. As for just holding cryptos, it won’t tax you.

But it would be ridiculous if a country has some kind of ruling on where you get taxed for unrealized gains. I think I’ve heard that news before in the US, but that was just a proposal.

Right here in the Philippines, there’s no system yet about crypto taxes. But it still falls under the general rule where anything that is realized income are subjected to tax if our income is above P250,000 in Philippine peso.

As far as I know countries where cryptocurrency is legal must pay taxes to the government. Whenever you sell your bitcoins and convert them to your home currency, you will be liable for tax. But when you hold your bitcoins in a wallet without selling them, you don't have to pay any taxes and they stay the same for a long time. But when you transfer your bitcoins from the wallet and sell them, you will definitely have to pay tax.

I suggest you consult a professional for guidance on this issue as it is a sensitive one and differs country to country. Some countries are very stringent with their tax laws and do not take lightly tax evasion of any kind. Is will be much better to pay the tax. I think it will vary depending on the government views on the subject.

Hmm, apparently this could be one of the unknowns that many countries have not been able to decipher in order to integrate bitcoin, the fact of how to manage it so that it can bring a benefit to both the country and its citizens is questioned a lot, without harming them as such and without it getting out of hand, since everything is done virtually and transactions can be carried out without going through a third party, this makes it difficult to collect a percentage as is normally the case with banks, causing people to evade these… It is a reality that if a currency enters the country and is used for any type of commercialization, a part must be paid to the government, that is called a tax, the question is how much must be paid and how it will be done, since it is not active It's stable, it's extremely volatile, so it gets a little tricky, but not impossible...

I can't directly answer your question simply because I really don't see something like that actually happening. Or maybe it could happen in some small countries but I can't even image countries like the US, the European Union, Japan or China using bitcoin like their first currency, they would have no control over it, they couldn't print more, it's something pretty much impossible.

That question is relative. It depends on the country you live in. For instance, some country haven't really put together the framework to tax cryptocurrency transactions. So it will be difficult to give a general answer your question.

Just like fiat money where people are taxed through VAT in most items they purchase, same will apply for in those countries that accepts payments with bitcoin. Except for people that are tax invaders, otherwise I don't understand why the said man is scared of paying a little token as tax for coins he has made and still would make more profit in the event of the next bitcoin ATH.
For countries like ours were there are strict policies against cryptocurrency use, if it were only a thing of tax payments we won't be having issues with it, but unfortunately different is the case.

This whole bureaucracy around crypto-taxation is nothing but sad. While the world moves quickly forward, led by the genius of blockchain and the promise of Bitcoin, some people are still stuck in the old ways of taxes. Wasnt the whole point of Bitcoin to test old ways of doing things?

The boring transaction-based tax policies that countries have been using as an excuse to be lazy with paper currencies will soon be out of date. As Bitcoin becomes more important, governments should act quickly to keep up. Your country's refusal to accept Bitcoin as a way to pay for things in stores is, to say the least, short-sighted. Bitcoin is a technological revolution, so it would be silly to limit its use to just trades. In the future, Bitcoin wont just be a shadow of traditional money; it will be the main thing. Prepare, or you'll fall behind.

Some of the countries have already imposed hefty tax on crypto and even on every single crypto transaction as well as trade, this is literally killing the essence of bitcoin as it was meant to be a source of financial freedom from corrupt government and regulators but unfortunately it looks like we have ailed, I know some of the users might say there are stores which accepts bitcoin as a payment but it's not practical to have it as source of payment considering the time it takes for transaction and for huge transactions even if price varies little bit then the receiver will incur profit or loss.

Seems like we cannot escape from clutches of regulators and taxes.

It appears that new regulations might be on the horizon, introducing a distinct tax framework for Bitcoin transactions or crypto exchanges as opposed to traditional fiat transactions. Up until now, the crypto community has grappled with taxation primarily in the realm of BTC-fiat transactions. However, as Bitcoin becomes more mainstream and gains traction as a means of transaction in various retail settings, the taxation dynamics could potentially undergo a divergence from the conventional fiat model.

The specifics of these changes are contingent upon the tax regulations upheld by each individual country. In my own nation, there are no indications as yet that Bitcoin can be utilized for in-store purchases. Consequently, taxation is levied upon direct crypto-fiat transactions conducted on exchanges, with the resultant tax deductions being facilitated by the exchange itself.

Yes, it works according to the tax laws of each country. Bitcoin is taxed more than fiat in many countries. So many sell their bitcoins at the end of the year. Due to which the prices of Bitcoin and other cryptocurrencies are seen to decrease every year towards the end of the financial year. Because they convert to fiat to avoid high tax and buy crypto again when tax is paid. So it is not possible to specify what kind of laws a country has because there are 195 countries in the world and it is not possible for us to keep track of every country.

It is certain, most people who lived in the 50s would not feel comfortable with life in this era. Because in terms of habits and in terms of technology, it is clear that they are very different. So it's not strange if parents or the elderly complain that life nowadays is not as comfortable as it used to be. Especially if they are still living in today's era, their age is too old, which is certain even though today's technology can be said to be more sophisticated than in the past, the majority of the elderly certainly won't understand how it works. Maybe that's why the elderly complain about life in today's world.
Basically crypto currencies like bitcoin must be subject to what is called a tax. Because in every country, there must be an institution that oversees the trading and investment system just like cryptocurrencies like bitcoin. So it is certain that every transaction will be subject to the applicable tax in that place. But what if bitcoin is not converted into money, will it still be taxed. Maybe the tax will still apply, because apart from the tax on transactions, there is also a tax on bitcoin (crypto) ownership. Then apart from that, every country must always emphasize and want the benefits of an asset like bitcoin. So if bitcoins are not converted into fiat currency, most likely the taxes will still be there. Because basically where we stand, there is a government that always cashes in or invests taxes in it.

So the elderly, actually don't need to worry about taxes when making sales. Because if he buys bitcoin at a low price and sells it during a bull run, the elderly will automatically benefit. And the taxes are definitely there, but even so, the elderly will not spend the profits he earns from bitcoins to pay taxes. So don't be too concerned about the opportunity.

Depends on what country you plan to use your bitcoin without exchanging it for fiat. In my country, it's pretty to exchange your bitcoin for fiat without the worry of taxation as most of us are already paying taxes through VAT(value added tax) when we buy goods and services, taxation is the worry of the uber rich and business owners here in the country. Regarding taxation of bitcoin even if you don't exchange it for fiat, I think that the government will eventually agree to it that they have to tax it even if it's not exchange into a fiat, taxes is the blood of a country and no one messes with that, this old man that OP is talking about is better off moving permanently to a Caribbean or any tropical country to spend his bitcoin and enjoy retirement.

Governments hate the idea of a peer to peer currency, the banks as a middle man report everything to them and as such they can easily track how you are spending every single cent of your money, now with the advent of CBDCs they want to take that place and become even more intrusive when it comes to the uses you can give to your money.

However bitcoin basically circumvents the measures they have taken to control your money and how you use it, and it would not surprise me if at some point they forbid all wallets except their own in an attempt to try to force you to use a wallet created by them and not allow you to truly own your coins.

I think the government will not let it happen, may be government will do anything to make the citizens pay taxes. but it is still possible if the fund is not tracked, some country prohibit their citizens to use other currency except it's national currency. I think it is normal for people try to avoid taxes, even many companies did it.

Tax is only required when you use a business-registered entity to buy things, service, etc. regardless what your payment is, either in bitcoin or fiat. But talking about a senior citizen, some country do exempt them to pay tax. I just don't know how it can be done when purchasing online, unless there is a form for senior citizen details

just consider this situation, those registered local crypto-exchanges are already paying tax to the government. so somehow, we are already indirectly paying taxes to the government. remember, most of these local exchanges are requiring kyc from their customers, so they have the database of all their users, and one legal request from the government, they can easily turn over their data to the government if necessary.

First of all everyone has their own outlook towards life and technology. If that senior citizen from a western country prefer 1950's time better than today's time then that's his own choice. The analog times were really great for the people who lived in that era because they were used to those things and they have spent most of their lives with those analog based tech stuff. However, the good thing about that senior citizen is that he still got interested in Bitcoin and invested money into it which really show that how visionary that person is.

Well, trusting Bitcoin's self-custody is also his own right and choice and I must say that having Bitcoin in one's own custody is the safest way to go with it for long term. He has done a really smart step to secure his Bitcoin and holding it in that way is truly appreciable, but his complaining about Bitcoin's sitting in that hard wallet isn't necessary at all because I also think that the Bitcoin's should stay in that wallet for the time being and whenever he finds a much profitable price range only then he should think about selling those Bitcoin.

I don't think that by selling his coins he'll be taxed and that's not even necessary for him. The Bitcoin is totally decentralized and it's someone's own property, and if someone wants to sell it then that person doesn't need to pay any taxes. I would recommend your friend to go with the decentralized way if he wants to be safe from those huge taxes because the centralized and regulated way will always have taxes during each step. I really don't think that at current times most of the countries are taxing the users who are converting their Bitcoin into fiat, but if in future something like that happens then your friend should try to decentralized way to sell his Bitcoins.