Denmark will amend the tax code to properly reflect residents’ operations with cryptocurrencies. This was warned by the head of the country’s tax authority, Morten Bødskov (Morten Bødskov), writes Berlingske Tidende.
Current rules lead to errors in calculating the tax base and to risks of tax fraud.
At present, the calculation of liabilities to the state from trading digital assets is based on the State Tax Act, enacted in 1922.
The agency identified around 16 000 individuals and companies that conducted cryptocurrency transactions between 2015 and 2019. Two-thirds of them reported information incorrectly on their tax returns.
The amendments will be developed by the Council on Tax Law, which has independent status. By 2023 the body will present a draft of the required changes.
The Council expressed concerns about potential concealment of income from cryptocurrency transactions. Under local law, providers of crypto services currently have no obligation to report to the regulator.
As reported, the Australian Taxation Office identified cases of underreporting of income from trading digital assets among 100 000 taxpayers.
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