Tax on Bitcoin Profits

Shauny2010

AndrewJRenko wrote: »

Great idea. Have you found a destination country with banks and tax authorities that will also give 2 fingers to Irish Revenue?

No just one like Belgium which doesn't Tax you on Bitcoin profits like Ireland does. In the mean time my neighbor has just sold his damp semi D celtic tiger house for €280,000 after being on the market for less than 4 weeks. Looks like I will sell mine now too and get the fook out of this sh1te hole of a country.

McCrack

AndrewJRenko wrote: »

I kind-of hope he does run the line to the Appeal Commissioners, but only if he sells tickets for the audience. I'd pay good money for a front row seat to watch this performance.

I wish there was a thumbs down on boards for comments because this would get one.

It's the type of belittling other posters that quite reasonably query Revenue's powers and claims to CGT on cryptocurrencies and the general lick arseing/siding to the Revenue Commissioners that's around this forum.

cnocbui

Shauny2010 wrote: »

No just one like Belgium which doesn't Tax you on Bitcoin profits like Ireland does. In the mean time my neighbor has just sold his damp semi D celtic tiger house for €280,000 after being on the market for less than 4 weeks. Looks like I will sell mine now too and get the fook out of this sh1te hole of a country.

On a list of OECD countries, Ireland comes 16th in tax competitiveness. I am aiming to move somewhere that improves on that by at least 11 places, probably more. CGT on Bitcoin is a minor consideration, as I decided to get out years before I ever bought a Bitcoin.

barneystinson

cnocbui wrote: »

No, but I still get out of bed each morning and carry on with life, taking one day at a time, crossing bridges when I come to them.

Yeah, that's actually a good analogy, since some bridges aren't pedestrianised and you could get a wallop of a train one of these days...

ZeroThreat

McCrack wrote: »

I wish there was a thumbs down on boards for comments because this would get one.

It's the type of belittling other posters that quite reasonably query Revenue's powers and claims to CGT on cryptocurrencies and the general lick arseing/siding to the Revenue Commissioners that's around this forum.

it's not really the 33% CGT I'm concerned about personally.

Some people are saying here if whenever you use your Bitcoin to trade for any other altcoin, you need to file a return and pay tax even if you don't cash out for fiat.

Would be so much easier when you eventually convert back to Bitcoin and sell for cash to calculate gains on a FIFO basis, but from what I read here, it seems that anyone who bought altcoins is already liable if the value of BTC changed between when you bought it and when you used it to buy other coins...

makeorbrake

Shauny2010 wrote: »

Best thing I can do is to Emigrate, cash in my Bitcoin and give the 2 fingers to Irish revenue.

I'm in! I've just applied for a year out from work (as an insurance policy in case BTC bombs in the meantime). After that, Panama here we come.


Will l be able to come back? Couldn't give a fiddlers. If Revenue present me with a bill, I go right back to the airport (if I ever come back in the first place which remains to be seen).

alb

makeorbrake wrote: »

I'm in! I've just applied for a year out from work (as an insurance policy in case BTC bombs in the meantime). After that, Panama here we come.


Will l be able to come back? Couldn't give a fiddlers. If Revenue present me with a bill, I go right back to the airport (if I ever come back in the first place which remains to be seen).

Congrats dude! remember back a couple of years ago in the latter stages of the bear market you me and a couple others were the only people talking about crypto at all on boards in the single "Buying Bitcoins" thread. You seemed like a good guy so I'm glad it's worked out for you.

KilOit

Read a through some of the thread and didn't find my answer.

Say i bought 10k of bitcoin 10 months and decided to cash out 10k euro now, do i pay tax on the whole amount (after 1270€)even though i'm only taking out what i put in or only after my initial investment, so any future cash outs after 10k

CIARAN_BOYLE

KilOit wrote: »

Read a through some of the thread and didn't find my answer.

Say i bought 10k of bitcoin 10 months and decided to cash out 10k euro now, do i pay tax on the whole amount (after 1270€)even though i'm only taking out what i put in or only after my initial investment, so any future cash outs after 10k

If you bought 10k ten months ago and it was 10 Bitcoin

And now your 10 Bitcoin are 10k each

You sell 1 Bitcoin to cash in

Your initial cost of that Bitcoin is 1k (10k divided by 10 bitcoin)

That means your gain is 9k

Take off your 1270 exemption means your taxable gain is 7730 which is taxable at 33%

KilOit

CIARAN_BOYLE wrote: »

If you bought 10k ten months ago and it was 10 Bitcoin

And now your 10 Bitcoin are 10k each

You sell 1 Bitcoin to cash in

Your initial cost of that Bitcoin is 1k (10k divided by 10 bitcoin)

That means your gain is 9k

Take off your 1270 exemption means your taxable gain is 7730 which is taxable at 33%

Wow that's insane, we're talking over 100 trades at least to get to this point.
This is impossible to keep track of

CIARAN_BOYLE

KilOit wrote: »

Wow that's insane, we're talking over 100 trades at least to get to this point.
This is impossible to keep track of

What's impossible you bought 10 months ago, you held you sold now

Or were you making transactions from bit coin to other currencies all along. Cause if so those transactions would have been triggering events for cgt,

Basic record keeping is required when you make investments. People have learned to do it for years with stock portfolios.

makeorbrake

alb wrote: »

Congrats dude! remember back a couple of years ago in the latter stages of the bear market you me and a couple others were the only people talking about crypto at all on boards in the single "Buying Bitcoins" thread. You seemed like a good guy so I'm glad it's worked out for you.

I remember distinctly. Your posts were insightful - at a time when I felt that I was inadequately informed re bitcoin/cryptocurrency. I know a hell of a lot more since then but yet, I am still just scratching the surface....there's so much to it and it's moving so fast....that my current knowledge is still only a drop in the ocean.

AndrewJRenko

McCrack wrote: »

I wish there was a thumbs down on boards for comments because this would get one.

It's the type of belittling other posters that quite reasonably query Revenue's powers and claims to CGT on cryptocurrencies and the general lick arseing/siding to the Revenue Commissioners that's around this forum.

Sure, keep on shooting the messenger. See how far it gets you.

nxbyveromdwjpg

CIARAN_BOYLE wrote: »

Or were you making transactions from bit coin to other currencies all along. Cause if so those transactions would have been triggering events for cgt,

99.99% of people worldwide making returns on cryptos will never do this. The revenue will almost certainly never look for it either, as long as the euro out and euro in is correct.

An exercise in time wasting.

nxbyveromdwjpg

Peregrinus wrote: »

This law has been in place since 1975.

It was a much more reasonable and fair 20% until 2008 though.

feelgoodinc27

Itzel Careful Treasure wrote: »

99.99% of people worldwide making returns on cryptos will never do this. The revenue will almost certainly never look for it either, as long as the euro out and euro in is correct.

An exercise in time wasting.

Not for Revenue, if they think they can some money out of you!

Shauny2010

feelgoodinc27 wrote: »

Not for Revenue, if they think they can some money out of you!

Revenue would not have the means or know how to be able to trace crypto transactions. They just will have to take your word.
In the mean time all people can do is lobby the TDs and councilors. Ask them why we have to pay so much Tax on our savings, point out how in the UK they pay a lot less and have Tax free ISAs to invest in. Germans don't pay the higher rate of tax until well over 200k.
Tell them if they don't change it then no vote. Its that simple.

KilOit

CIARAN_BOYLE wrote: »

Or were you making transactions from bit coin to other currencies all along. Cause if so those transactions would have been triggering events for cgt,

Good luck to revenue tracking all the trades over 5 exchanges and ICO's the past year. never gonna look for it, they haven't a clue how to follow through with crypto yet, in future with more regulation it's possible.

cnocbui

Revenue takes on shapeshift, demands details - everyone laughs.

AndrewJRenko

Shauny2010 wrote: »

Revenue would not have the means or know how to be able to trace crypto transactions. They just will have to take your word.

Sounds like all the cute hoors in the 80s and 90s who boasted about how Revenue would never be able to trace their offshore accounts and non-resident accounts. They all paid up, with interest and penalties.

Shauny2010 wrote: »

point out how in the UK they pay a lot less and have Tax free ISAs to invest in.

Would that be similar to our tax-free pension investment options?

KilOit wrote: »

Good luck to revenue tracking all the trades over 5 exchanges and ICO's the past year. never gonna look for it, they haven't a clue how to follow through with crypto yet, in future with more regulation it's possible.

And if that regulation will also very likely allow them to look back over historical transactions too. Just think about all those punitive interest and penalties building up over time...

Shauny2010

AndrewJRenko wrote: »

Sounds like all the cute hoors in the 80s and 90s who boasted about how Revenue would never be able to trace their offshore accounts and non-resident accounts. They all paid up, with interest and penalties.

Would that be similar to our tax-free pension investment options?


And if that regulation will also very likely allow them to look back over historical transactions too. Just think about all those punitive interest and penalties building up over time...

They can't track a crypto currency. You don't have to register anywhere to own it, it doesn't matter about location, or even your age. Not until people start cashing it in for Fiat or in exchange for work will it show up. If peeps are smart enough they will leave it in crypto as Fiat money is heading for hyper Inflation.

Revenue have no record of my Bitcoin or other crypto holdings, they never will.
Once I sell my overpriced semi-D (which I will not have to give revenue a cent) I'll be saying goodbye to this over rated dump.


As for the pensions being some form of tax free benefit, that's just more bullsh1te. The pension Industry gives really bad ROI here. They are just another bunch of crooks. Pensions are like a carrot that is dangled in front of the ordinary worker. Revenue means test you then when you do hit pension age so you get Taxed on the way out.
Oh yeah you are going to tell me about the Tax free limit but what about how that pension when added to your paye pension then gets taxed. Pure bull of a scheme.
We pay far too much tax, no wonder the cash economy is thriving. Ireland is just going to turn into another Greece of the EU

ZeroThreat

AndrewJRenko wrote: »

Sounds like all the cute hoors in the 80s and 90s who boasted about how Revenue would never be able to trace their offshore accounts and non-resident accounts. They all paid up, with interest and penalties.

Would that be similar to our tax-free pension investment options?


And if that regulation will also very likely allow them to look back over historical transactions too. Just think about all those punitive interest and penalties building up over time...

A lot of people on this subforum will be doing serious jailtime in a couple of years.

Dohnjoe

Shauny2010 wrote: »

Revenue have no record of my Bitcoin or other crypto holdings, they never will.
Once I sell my overpriced semi-D (which I will not have to give revenue a cent) I'll be saying goodbye to this over rated dump.

They can get info from exchanges which will have your name all over them, e.g. the IRS has subpoena'd Coinbase to turn over any accounts with a certain set of criteria

Also, if/when you cash out, that will obviously be noted by the bank if it's large amounts (even if you split them up) and potentially sent to the tax authorities - even doing this abroad coud attract attention if you haven't had residency there for long enough

dxhound2005

Shauny2010 wrote: »

They can't track a crypto currency. You don't have to register anywhere to own it, it doesn't matter about location, or even your age. Not until people start cashing it in for Fiat or in exchange for work will it show up. If peeps are smart enough they will leave it in crypto as Fiat money is heading for hyper Inflation.

When are you expecting hyperinflation? As you know that is inflation of more than 50% per month.

To me the Euro looks a lot more stable than crypto.

Shauny2010

Dohnjoe wrote: »

They can get info from exchanges which will have your name all over them, e.g. the IRS has subpoena'd Coinbase to turn over any accounts with a certain set of criteria

Also, if/when you cash out, that will obviously be noted by the bank if it's large amounts (even if you split them up) and potentially sent to the tax authorities - even doing this abroad coud attract attention if you haven't had residency there for long enough

You are presuming I bought them on an exchange or sell them for that matter.
My main point being, before I cash out Fiat, Revenue have no way on earth of tracking what trades or transactions I made once I, like loads of others are not registered on the exchanges.
Yes currently you have now to do so but not up until lately so its tough sh''t revenue

barneystinson

Shauny2010 wrote: »

You are presuming I bought them on an exchange or sell them for that matter.
My main point being, before I cash out Fiat, Revenue have no way on earth of tracking what trades or transactions I made once I, like loads of others are not registered on the exchanges.
Yes currently you have now to do so but not up until lately so its tough sh''t revenue

I think the big thing that you're failing to understand is that if you have large unexplained wealth / lodgements, Revenue can assess you to tax on the full amount of it, and that could be income tax rather than CGT...

If that happens, it's up to the person assessed (as the party in possession of the necessary information) to prove Revenue's assessment(s) incorrect and establish their true tax liability.

Sticking two fingers up to a Revenue authority can be a very costly thing to do.

Bobeagleburger

Shauny2010 wrote: »

You are presuming I bought them on an exchange or sell them for that matter.
My main point being, before I cash out Fiat, Revenue have no way on earth of tracking what trades or transactions I made once I, like loads of others are not registered on the exchanges.
Yes currently you have now to do so but not up until lately so its tough sh''t revenue

How did you deposit money to wherever you purchased your coins? There's almost certainly a money trail.

Nabber

Depends on how much you are talking about. I have 3.7mil in a coin. I bought them at .000008BTC back when BTC was $650. Now they value at about 320,000$. Given my initial investment was a fraction of its current value I owe CGT on 314,000€.

I’ve no intention of selling just yet. I do however move some money out into an e-card. I move out 3% a quarter with a cap of 5k.

I have no issue with CTG. Pay a high bracket on my wage, I didn’t have the luxury of a college education, I’ve never had social payments, don’t qualify for mortgage relief, wife is at home (4 kids under 9) I work a 60hour week.
I’m not paid enough to consider my self Middle upper, but I am paid enough to miss out on most benefits whilst also paying a lot.

I don’t have a bad life, but myself and the wife have worked really hard, adding 4 more kids to the next generation who’ll pay the pension bill.

Bottom line, if I can avoid CGT on anything, I wll

cnocbui

RoboKlopp wrote: »

How did you deposit money to wherever you purchased your coins? There's almost certainly a money trail.

Yes there is a paper trail, but outgoings are not reported to Revenue by banks in the way suspicious deposits are. Revenue would already have to be conducting an investigation and request the records.

While there is a CGT liability for inter-crypto transactions, these aren't reported to Revenue so they have no way of knowing they have occurred. It's only conversion of crypto to fiat and deposits from an exchange to a persons account that banks might report on.

I suppose exchanges might hand over details of all transactions to Revenue if requested, but probably only if their local regulatory authority requires it or permits it under data protection regulations. Tricky one, that.

If a person used shapeshift to convert between cryptos, Revenue would have no possible way of finding out - ever.

I suspect Revenue would be fairly pragmatic about this. So long as you paid CGT on profitable conversions between cryptos and fiat, they would likely be happy enough with that.

CIARAN_BOYLE

cnocbui wrote: »

If a person used shapeshift to convert between cryptos, Revenue would have no possible way of finding out - ever.

I suspect Revenue would be fairly pragmatic about this. So long as you paid CGT on profitable conversions between cryptos and fiat, they would likely be happy enough with that.

The thing is it's a self assessment system so it's very difficult for Revenue to 'catch you' unless you are randomly selected for audit.

Once you are randomly selected for audit the burden of proof is yours in that you get to prove that you have acted correctly.

For example if you file a return that you had a buying value of 10k and a selling value of 200k and a taxable gain of 190k. Revenue ask to see documentation of this.

You show a document that you you bought 10 Bitcoin for 1k each and you sold 20 bitcoin for 10k each. Well then the question becomes when did you get the extra bitcoin.

That said it's very difficult for Revenue to catch you out on this unless you are randomly called. It doesn't mean you are acting correctly.