Sweden Crypto Tax: Cryptocurrencies like Bitcoin and Ethereum can be taxed in nearly every country, including Sweden being the exception. If you live in Sweden or are a Swedish taxpayer, a few essential tax regulations differ from most European nations today. In this complete tax guide, you will discover all you should learn about crypto taxation in Sweden as per tax rules from Skattverket, the Swedish tax authority. You will also learn the amount of tax you must pay on the crypto earnings and losses, how to report your losses and profits on the tax form K4 and how to utilize the tax calculator for crypto to prepare all the tax returns you’ll need.
Sweden Crypto Tax
A heads-up! This guide is very long due to the intricate nature of taxation for cryptocurrency. We recommend that you read the entire guide the first time to ensure you don’t overlook any critical information; you can utilize the menu navigation to the right to navigate to any specific tax-related question in the future.
What tax amount is imposed on digital currencies in Sweden?
The tax you’ll have to pay for your crypto is dependent on the specific transaction you’re making as well as the type of tax applicable, and in some instances, what you earn as well as the location where you reside:
- Capital gains from crypto 30 percent tax
- Crypto interest income: 30% tax
- Earnings from crypto: You can pay two possible taxes: Taxes on National Tax on Income Tax or Municipal Income Tax. You’ll have to pay a national income Tax of 20 percent if you earn more than 613,900 SEK per year, and Municipal Income Tax is different based on your location and is a typical three-quarters tax that applies to any income.
What is the taxation of cryptocurrency in Sweden?
In Sweden, the cryptocurrency market is targeted by a tax on capital gains taxes on income, capital gains tax, and interest tax on income.
Tax on capital gains: If you sell your crypto, you’ll be charged an income or capital loss depending on how your cryptocurrency’s value has changed since receiving it. For instance, you could sell or trade your cryptocurrency in exchange for a different cryptocurrency.
Interest income tax: If you earn interest on cryptocurrency, it will be subject to income tax on interest. For instance, you make cryptocurrency from stakes or get crypto interest through centralized exchanges.
Income tax: If you earn income from cryptocurrency, you can claim income according to the fair market value of your cryptocurrency at the date of receipt. For instance, you can gain cryptocurrency through mining.
Can Skatteverket track crypto?
Yes. Skatteverket can track your crypto.
By Europe’s 6th Anti-Money Laundering Directive – any business that offers financial services within the EU, such as crypto exchanges, has to comply with strict rules regarding identifying customers that you may recognize in the context of KYC verification. All data that is processed in the course of KYC is shared between EU members, including Sweden.
Are personal assets, such as cryptocurrency, tax-free?
The personal property of cryptocurrencies is subject to taxation if any of the following scenarios are applicable.
- The asset is a part of the individual’s business
- The support is purchased to be used for speculation purposes
In most cases, the investors buy crypto-assets expecting a later income. Therefore, crypto-assets are tax-exempt in a majority of instances.
If you believe your crypto assets don’t fall in the category of speculative investments, You must prove that you bought your cryptocurrency without the intention of making a profit.
Crypto Capital Gains Tax Sweden
If you decide to dispose of cryptocurrency, you’ll experience an income or capital loss and have to pay Capital Gains Tax on any gains. The rules for the disposal of crypto by Skatteverket guidelines comprise:
- Trading cryptocurrency for SEK or other fiat currencies
- The exchange of one cryptocurrency for another
- The use of crypto to buy items or services
- Lend crypto on both centralized and decentralized platforms
- The process of adding and removing the decentralized liquidity pools
Sweden’s Capital Gains Tax rate is a fixed 30%, regardless of your income.
How can I determine my gains and losses in crypto?
If you decide to dispose of cryptocurrency, you’ll experience either a loss or gain by how the value has changed since you first acquired it.
Use this formula to determine the capital gain and loss.
Capital Gain/Capital Loss = Sales Price – Cost Basis
In this scenario, the Sales Price is the amount your currency is worth in Swedish Kroner as of sale.
Your cost base is the amount you paid for your cryptocurrency and any applicable exchange or blockchain fees.
To understand the mechanism behind this, Let’s look at an illustration.
If you aren’t initially sure of your cryptocurrency’s cost basis, you must consider that your cost basis should be zero. But, this could cause higher capital gains and higher tax bills.
Crypto losses Sweden
There are times when your crypto transactions can result in a gain. When you decide to dispose of that results in losing money, you’ll incur an investment loss. It’s not all bad news since you can utilize them to offset gains and lower your total Capital Gains Tax bill.
The reality is that Skatteverket provides exact regulations regarding capital losses that must be deducted, specifically that only 70% of the loss can be removed.
The Stolen and lost crypto Sweden
If you’ve lost the keys to your personal information, suffered your money stolen, or lost your crypto because of an exchange that collapsed, You may wonder how you can subtract the losses from the capital gains you earn.
The good news is that Skatteverket issued a guideline regarding this, and it’s not a good thing.
The rules are clear: when you lose access to your crypto account due to losing your private key or being compromised, you’re not entitled to a deduction for losses. Calculating the cost basis of your assets is also prohibited if you own multiple purchases of the identical type you have, even if you haven’t sold or lost access to them.
Skatteverket also offers guidance regarding whether people can claim deductions when they lend assets via Celsius or suffer losses due to FTX. It also provides specific guidelines for both.
For FTX users, If you’ve had to dispose of assets via the FTX platform which resulted in capital gains or losses, you’ll need to declare both on your tax return. However, you must also submit an open claim to report the losses.
An open claim explains the deduction request in your tax returns’ “other information” section. Be aware that you can do this if you’ve suffered losses experienced as a result of the disposal of FTX before the collapse and not only for the funds that were frozen by the platform. Suppose you suffer losses from frozen funds by the forum. In that case, you wait until bankruptcy proceedings have concluded to see a more precise picture of your losses and whether you’ll be eligible to claim these.
In the case of Celsius users who have lost their cryptocurrency due to lending it to the platform, it’s more complex. From the viewpoint of Skatteverket, when you borrowed crypto, you got rid of it when where you transferred it over to Celsius. Anyone who has given cryptocurrency to Celsius has, in effect, gotten rid of their assets and is required to perform the calculation of capital gains on their Income Tax return. Instead of cryptocurrency assets, they now have a claim to Celsius.
To deduct a loss from a claim related to Celsius in the first instance, it must be proven to; among other things, it must be cleared off. Security is considered disposed of if the entity issued it was declared bankrupt and is a restricted corporation or cooperative association. Because Celsius is currently undergoing corporate restructuring under Chapter 11, the claim cannot be considered to have been disposed of because of bankruptcy. If Celsius were to declare bankruptcy in the future, The Swedish Tax Agency would need to examine whether claims against Celsius are deemed a security risk for the company. However, they’ll only be able to if Celsius is declared bankrupt.