Danish court clarifies how bitcoin profits are taxed

The Danish Supreme Court has defined the circumstances under which the sale of bitcoin constitutes a taxable event. The ruling is stated on the official website of the government authority.

The judges considered two cases involving gains from the digital asset. In the first, a company purchased bitcoin from a third party; in the second—miners.

For the company, the court held that their purchase was speculative in nature. Under local law, such transactions are not exempt from taxation.

As for the miners, the method by which they obtained the bitcoins was classified as income, so in the event of selling the coins they must pay tax.

“The Supreme Court considers that the bitcoins obtained should be treated as assets acquired for the purpose of subsequent turnover as an integral part of the business,” the ruling states.

Both precedents arose between 2011 and 2013, with sales in 2017 and 2018. In reaching the decision, the court referred to Denmark’s National Tax Act.

Earlier, Italian authorities approved the introduction of a 26% capital gains tax on profits from trading digital assets.

In March 2023, U.S. President Joe Biden proposed changes to the taxation of cryptocurrency transactions. Under his calculations, this would lift industry revenues to as much as $24 billion.

In February, the bitcoin exchange Binance introduced a free service for calculating taxes on crypto trading.