Portugal crypto tax: rules, exemptions, and filing

Portugal crypto tax: rules, exemptions, and filing 

Portugal is known as one of Europe’s most crypto-friendly destinations. However, the tax landscape shifted in 2023, when new rules replaced the blanket exemption on crypto assets with a framework that distinguishes between short-term gains, long-term holdings, and different types of crypto income. 

As a result, the country remains attractive for investors, but the way your crypto is taxed now depends on whether you’re holding, staking, or trading.

In this guide, we’ll walk you through the details of Portugal crypto tax, explaining how the rules apply to different types of activity, what exemptions still exist, and what you need to know to stay compliant. 

Key takeaways: Portugal crypto tax

• Long-term gains remain exempt – Selling crypto after 366 days is tax-free in most cases, while short-term disposals are taxed at a flat 28%.

• Income type defines taxation – Staking and lending rewards face a 28% levy, while professional trading or large-scale mining is taxed as business income under progressive rates of 14.5%–53%.

• Not every move is taxable – Wallet-to-wallet transfers, gifts to close family, and NFT trades remain outside the scope of taxation.

• Filing is structured but strict – Crypto must be reported via Modelo 3, with annexes for capital gains (G), staking income (E), and professional activity (B). Returns are due by June 30, and payments by August 31.

• Records are your safety net – Maintain exchange reports, wallet exports, and bank statements for at least 10 years, as audits can occur long after the transaction year.

Portugal crypto tax 2025 landscape

Portugal’s reputation as a crypto haven began in 2019 when the Portuguese Tax & Customs Authority confirmed that buying and selling crypto would not be taxed. This hands-off approach made the country especially appealing to investors seeking a safe and tax-free environment.

In 2020 the government went further with its Digital Transitional Action Plan. By establishing experimental “Free Zones,” Portugal positioned itself as a testing ground for blockchain innovation while keeping regulatory barriers low.

The turning point came in 2023 with the introduction of the State Budget. The new rules introduced a 28% tax on crypto gains from assets held for less than one year, while long-term holdings of more than 365 days remained exempt in most cases. 

At the same time, different forms of crypto income such as staking, trading, and mining were classified and taxed under Portugal’s Personal Income Tax Code. Alongside these changes, the EU’s MiCA regulation, taking full effect by December 2024, provided further clarity on how tokens should be treated across Europe.

Portugal also follows EU case law on crypto transactions, treating cryptocurrencies in the same way as traditional currencies. According to rulings by the Court of Justice of the European Union and Portugal’s Tax Authority, exchanging crypto for fiat or vice versa is exempt from VAT. Income, however, can still arise from capital gains, fees on crypto-related services, or payments received in digital assets.

Portugal continues to offer one of Europe’s most balanced approaches, combining clear tax obligations with meaningful exemptions. Its long-term capital gains relief, VAT-free exchange rules, and supportive regulatory framework ensure the country remains a leading destination for both investors and innovators in the digital asset space.

How is crypto taxed in Portugal?

Here is a breakdown of the main rules, based on categories in Portugal’s Personal Income Tax Code:

Capital gains (Category G)

If you only invest in crypto and do not trade professionally, the tax depends on how long you hold your assets:

• Held for more than one year: Gains are exempt from capital gains tax in most cases. This exemption does not apply if the token is classified as a security or if the transaction involves a counterparty in a “blacklisted” jurisdiction.

• Held for less than one year: Profits are taxed at a flat rate of 28%.

Capital income (Category E)

Passive income from crypto, such as staking rewards, lending interest, or yield from DeFi protocols, is taxed at a flat 28%. This applies no matter the holding period, since it is treated as income rather than investment gains.

Self-employment income (Category B)

If crypto activity resembles a business, it is taxed as self-employment income. This includes:

• Frequent day trading

• Running large-scale mining operations

• Market making or organized professional activity

Profits are included in Portugal’s progressive income tax brackets, which range from 14.5% up to 53%, depending on total annual earnings. Business expenses can generally be deducted.

Note: Under Portugal’s new NHR 2.0 (IFICI) regime, certain professions considered high-value (such as technology, R&D, and related fields) may qualify for a flat 20% tax rate on employment income. This applies to salaries earned from a Portuguese employer in qualifying fields, for example, someone working as an engineer or researcher at a crypto company.

It’s important to note that this preferential regime does not apply to capital gains, staking rewards, or other forms of crypto investment income, which continue to be taxed under their own categories.

Corporate income tax

If crypto activity is structured through a company, income may fall under corporate income tax instead of personal PIT. The standard corporate rate is 20%, with possible municipal surcharges. This often applies to companies running mining farms or exchanges.

Taxable events in Portugal crypto tax: What actually triggers taxation

Not every crypto transaction is taxed in Portugal. The key is knowing which actions count as taxable events under the current framework. 

Here’s how the most common scenarios are treated:

• Selling crypto for euros (off-ramp): Converting crypto into fiat, such as selling Bitcoin for euros, is a taxable event. Even if the euros remain in your exchange wallet, the disposal of the crypto counts as a sale. If held for less than a year, it will be taxed at 28%.

• Crypto-to-crypto swaps: Exchanging one cryptocurrency for another (e.g., ETH → SOL) is not taxed immediately if the new token inherits the same cost basis. You only pay tax when the crypto is eventually converted into fiat.

• Staking and mining rewards:

• Hobby staking/mining: Category E, taxed at 28%.

• Large-scale mining or validator operations: Category B, treated as a business with progressive rates between 14.5% and 53%.

• Receiving crypto as payment: If you’re paid in crypto, it’s taxed just like if you were paid in euros. Salary is treated as normal employment income (Category A), while freelance or business income is treated as self-employment (Category B). The taxable amount is the euro value at the time of receipt, and any later sale of the crypto may trigger capital gains tax.

• DeFi, airdrops, and yield farming: Rewards from yield farming, liquidity pools, or similar DeFi activities are taxed as passive income at 28% under Category E. Airdrops are also treated as income, valued at the euro equivalent when received. Future gains on those tokens are taxed separately, based on how long they are held before disposal.

When is crypto tax free in Portugal?

Portugal’s crypto tax regime has narrowed since 2023, but several activities and scenarios remain tax-free. 

• Long-term holdings: Selling coins after 366 days or more is exempt from capital gains tax, provided the asset is not classified as a security and the transaction does not involve a counter-party in a blacklisted jurisdiction.

• Gifts to close family: Transferring crypto to a spouse or direct heirs is generally exempt from stamp duty, allowing family wealth to pass on without additional tax burdens.

• Wallet-to-wallet transfers: Moving assets between your own wallets or exchanges is not treated as a disposal and therefore has no tax impact.

• NFT transactions: Profits from trading non-fungible tokens (NFTs) are currently not taxed in Portugal. Whether swapping, trading, or selling NFTs, gains are exempt under existing rules.

Portugal crypto tax record-keeping and compliance

Accurate record-keeping is central to staying compliant with Portugal’s crypto tax rules. Investors are expected to maintain clear evidence of their activity so they can justify exemptions or report gains correctly if audited. 

Key records you must keep include:

• Timestamps for every purchase, sale, or trade.

• The euro value of each transaction at the exact time it took place.

• Proof of staking or mining rewards, especially if you claim they are hobby-level income rather than professional.

• Supporting documents that confirm a token’s legal status if you are applying the one-year exemption.

These records are critical for showing whether a transaction qualifies as a taxable short-term disposal or an exempt long-term gain.

To make filing smoother, maintain a comprehensive trail of your crypto activity. Useful documents include:

• Exchange CSV files and complete transaction histories.

• DeFi wallet exports for staking, farming, or swaps.

• Bank statements showing fiat deposits and withdrawals.

• A simple ledger recording each asset’s purchase date, acquisition cost, and disposal value.

Investors should keep these records for ten years, since the Portuguese tax office has the authority to audit long after the year of the transaction. This long retention period makes organized record-keeping essential for anyone active in the crypto space.

How to calculate your crypto tax in Portugal

Calculating crypto tax involves working out your profit or income in euros:

• For each asset sold, subtract the euro cost basis from the euro sale price.

• Total the gains from all disposals held under one year and apply the 28% flat tax.

• Add staking, lending, or similar passive income and apply the 28% rate, unless filing as a professional.

• If you qualify under Category B, calculate net business income (revenue minus expenses) and apply the progressive income tax brackets.

How to file for crypto tax in Portugal

Filing crypto taxes in Portugal follows the same process as filing your annual income tax return, but with extra forms to cover digital assets. Everything is submitted through the Portal das Finanças, Portugal’s online tax platform.

Start by completing the Modelo 3 income tax return, which is the main form required for all residents. Your crypto activity is then broken down by category and declared in the relevant annexes:

• Anexo G is used to report capital gains from disposals of crypto, split into coins held less than 365 days (taxable) and those held longer than 365 days (usually exempt).

• Anexo E covers passive income such as staking or lending rewards, which are taxed at a flat 28%.

• Anexo B applies if your crypto activity is considered professional or business-like, such as day trading or large-scale mining. In this case, your profits are treated as business income and taxed progressively.

Once your annexes are complete, submit your return online through the Portal das Finanças by June 30. Any short-term tax due must then be paid by August 31 to avoid penalties or interest.

At Touchdown, we simplify this process for you. Our legal and tax experts provide guidance on filing for complex cases such as cryptocurrency, securities, and capital gains. We create a personalized tax strategy to help reduce liabilities, avoid mistakes, and give you peace of mind knowing your return is fully compliant.

Why Portugal continues to attract crypto traders and digital nomads

Portugal stands out as one of Europe’s most crypto-friendly destinations, combining lifestyle benefits, favorable tax rules, and the everyday usability of digital assets. 

Here’s why:

• Pay with crypto in daily life: A growing number of services and businesses accept Bitcoin, Ethereum, and other coins, from relocation firms to online platforms. 

• Supportive regulations: Compared to stricter jurisdictions such as the US, Portugal offers lighter oversight. Investors benefit from clear tax rules, VAT exemptions on crypto-to-fiat exchanges, and fewer barriers to trading and holding assets.

• Convenient infrastructure: With Bitcoin ATMs in major cities, residents and visitors can easily withdraw or convert their holdings. This makes Portugal not just tax-friendly but also practical for everyday crypto use.

• No VAT on crypto transactions: Exchanging crypto for euros (or vice versa) is exempt from VAT, strengthening Portugal’s position as a fair and transparent hub for digital assets.

• A hub for digital nomads: Many remote workers relocate under the D8 Digital Nomad Visa, which allows them to live in Portugal while earning from abroad. For freelancers and crypto enthusiasts, this means enjoying Portugal’s lifestyle while benefiting from its balanced crypto framework.

How Touchdown helps you relocate to Portugal with confidence

Touchdown is Portugal’s leading relocation platform, designed to take the stress out of moving abroad. Backed by a dedicated team of Portuguese legal experts, we bring together everything you need to settle and succeed in your new home, from visas and tax advice to housing and compliance, all in one seamless platform.

We understand that no two relocation journeys are the same. Whether you are moving solo, with family, or as a digital nomad, Touchdown builds a tailored plan around your goals and lifestyle. Our free Eligibility Checker quickly identifies your best options, while our in-house lawyers and step-by-step platform ensure full clarity at every stage.

Our legal team guides you through essential requirements such as securing your NIF and opening a bank account. We also provide dedicated tax consultations, helping you understand Portugal’s frameworks, like the crypto tax rules, so you can optimize your setup from day one. 

For personalized advice, you can also book a 1:1 consultation with our experts. We’ll design a relocation strategy tailored to your needs, so you can focus on building your new life in Portugal with confidence.

FAQs on Portugal crypto tax

Which EU country has the best crypto tax?

Germany and Portugal are often considered the most attractive for crypto tax. Both countries exempt gains from crypto held for more than one year, making them especially appealing for long-term investors.

What country has zero crypto tax?

Several countries offer no taxes on cryptocurrency gains for individuals, but the rules depend on factors like residency, how long assets are held, and whether the activity is treated as personal investing or a business. Jurisdictions such as the UAE, El Salvador, and Belarus have introduced tax-free regimes, but in most cases you need to establish tax residency there to fully benefit from a “zero crypto tax” status.

Is Portugal 0% tax?

Not entirely. Portugal ended its full exemption in 2023. Gains on crypto held for less than one year are taxed at 28%, and income from staking is also taxed. However, gains on assets held for more than 365 days remain tax-free in most cases, which still makes Portugal highly competitive.

Are capital gains taxed in Portugal?

Yes. Crypto sold within 12 months of purchase is subject to a flat 28% capital gains tax. If the asset is held longer than a year, the profit is generally exempt unless the token is classified as a security or involves a blacklisted jurisdiction.