If you have more than R $ 5,000 in bitcoins or other cryptocurrencies, you must inform the possession of these virtual currencies in the “Goods and rights” form of the 2021 Income Tax return.
Starting with this year’s declaration, the IRS created specific codes to inform cryptocurrencies.
How to declare cryptocurrencies
Cryptocurrencies must be declared as if they were an asset, such as a house, a car or a financial application.
To do this, open the “Goods and Rights” form in the IR 2021 declaration program and click on “New”. Inform if the purchase was made by you or one of your dependents. Then select the “code” for the asset.
As of this year’s declaration, the IRS has created three specific codes to report ownership of crypto assets:
– 81: Bitcoin (BTC);
– 82: Other cryptocurrencies that are digital currencies, known as altcoins: Ether (ETH), XRP (Ripple), Bitcoin Cash (BCH), Tether (USDT), Chainlink (LINK), Litecoin (LTC);
– 89: Other cryptography that are not considered cryptocurrencies (“payment tokens”), but are classified as “security tokens” or “utility tokens”.
Detail the purchase of the currency in the “Discrimination” field. Enter which cryptocurrency you purchased, the amount purchased, date of purchase and the name and CNPJ of the brokerage house where the transaction took place. If the purchase was made directly from someone else, please provide their name and social security number.
It is also important to inform where the cryptocurrencies are in custody (stored). If they are in a company or brokerage, inform the name and CNPJ. If you keep the virtual currencies in a digital wallet, inform the model used.
If you did not have cryptocurrencies in 2019, fill the “Situation on 12/31/2019” field with a value of zero. In the field “Situation on 12/31/2020” inform the amount paid in reais.
If you already had cryptocurrencies and bought more, add the amount of 2019 with the purchases of 2020 and report the result in the field “situation on 12/31/2020”. s
and you already had cryptocurrencies in 2019 and did not buy more in 2020, just repeat the value of the field “situation on 12/31/2019” in the field “situation on 12/31/2020”.
Do not update the value of the currencies by the current quote. What counts for the IR statement is how much you paid at the time of purchase.
If you have already declared cryptocurrencies in the past year and used the code “99 – other”, update the declaration form and declare your digital currencies according to one of the codes informed above.
Those who sold cryptocurrencies last year and had already declared their ownership in 2019 should write off the good in this year’s declaration. To do this, enter the details of the sale in the “Discrimination” field.
Repeat the amount declared in 2019 in the “situation on 12/31/2019” field and put zero in the “situation on 12/31/2020” field.
If you sold part of the coins, reduce the value of 2020 in proportion to the amount of coins sold. For example, you had 10 bitcoin declared for R $ 300 thousand, but sold half in 2020. Then enter the balance of R $ 150 thousand in the field “situation on 12/31/2020”. Do not forget to also update the “code” of the item, from “99 – others” to one of the codes informed above.
If you sold more than R $ 35 thousand in cryptocurrencies within the same month of 2020, the eventual profit from this operation is subject to the payment of capital gain tax. Monthly sales below that amount are exempt from tax.
Taxation is progressive, varying according to the size of the profit: 15% on the monthly net gain of up to R $ 5 million 17.5% on the gain above R $ 5 million and below R $ 10 million 20% on the gain above R $ 10 million and below R $ 30 million 22.5% over the monthly gain above R $ 30 million.
The taxpayer is responsible for calculating and paying capital gains tax on cryptocurrencies. There is a specific program for reporting last year’s capital gains, GCAP 2020, which must be downloaded by the taxpayer on the Revenue website.
The payment of the tax must be made until the last business day of the month following the sale. For example, if you sold bitcoins in March 2020, the tax should have been collected by April 30 of that year.
To pay the tax you must complete the GCAP 2020 and generate a Darf (federal tax document) with your data (name, phone and CPF) and the “revenue code” with the number 4600, referring to capital gain tax on sale of goods.
It is necessary to generate a Darf for each month of the year in which there were sales of cryptocurrencies above R $ 35 thousand with profit. The GCAP program does not allow you to offset profits from possible losses from the sale of cryptocurrencies in previous months, as is the case with stock trading.
If you have not made the payment on time, it will be necessary to generate a new Darf, with interest of 1% per month and a fine of 0.33% per day, which can reach 20% of the amount due. To calculate the Darf with a fine and interest, use the Sicalcweb program, available on the Revenue website.
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