Crypto Tax Policy Review in Portugal: Future Changes and What Investors Need to Know
Jan, 20 2026
Portugal used to be the go-to place for crypto investors who wanted to avoid taxes. If you held Bitcoin or Ethereum for more than a year, you paid zero in capital gains tax. That changed in 2023. The government didn’t shut the door - it just added a new lock. Now, the rules are clearer, more complex, and built for the long term. If you’re holding crypto in Portugal, or thinking about moving there, you need to know exactly how the system works today - and what’s likely to change next.
How Portugal’s Crypto Tax System Works Right Now
Portugal doesn’t treat all crypto activity the same. It splits it into three buckets, each with its own tax rules. This isn’t random - it’s designed to target different behaviors. If you’re just holding, you’re treated differently than someone trading daily or mining at scale.Category G: Capital Gains - This is what most people care about. If you buy Bitcoin and sell it later for a profit, that’s a capital gain. The key? Holding period. If you hold for less than 365 days, you pay 28% tax when you convert to euros. If you hold for a full year or longer? No tax at all. This rule applies only if you or your exchange are based in the EU, EEA, or a country with a tax treaty with Portugal. The IRS uses FIFO (First In, First Out) to track which coins you sold. That means if you bought Bitcoin at $30k in January and $40k in June, and you sell 1 BTC in October, they assume you sold the January one - even if you meant to sell the June one.
Category E: Passive Income - This covers staking, lending, and interest earned from crypto. You don’t pay tax when you get the reward. You pay when you turn it into euros. So if you earn 0.5 ETH from staking in March and hold it until November before selling, you only owe tax in November. The rate is a flat 28%. But here’s the twist: you can choose to add this income to your other earnings and be taxed at Portugal’s progressive rates (14.5% to 53%). For most people, the flat 28% is better unless you’re already in a high tax bracket.
Category B: Professional Activities - If you’re trading crypto as a business - think day trading, running a mining rig, or operating a validator node - you’re in this category. The tax treatment here is tricky. For mining, you pay tax on 95% of your gross income because of energy use concerns. For everything else - trading, arbitrage, DeFi strategies - you pay tax on only 15% of your gross income. That 15% becomes your taxable income, which then gets hit with Portugal’s progressive income tax rates. So if you make €100,000 from trading, only €15,000 is taxed as income. That’s a huge break. But there’s a catch: you can’t claim this simplified rate if your annual gross income from crypto exceeds €200,000.
How Portugal Compares to Other European Countries
Portugal’s system isn’t the easiest in Europe - but it’s one of the most balanced. Let’s break it down:- Germany: Also tax-free after one year. But short-term gains are taxed as regular income - up to 45%. Portugal’s 28% flat rate is simpler and lower.
- France: A flat 30% on all crypto gains, no matter how long you hold. Plus social charges. No long-term exemption. Portugal wins here.
- United Kingdom: Capital gains tax at 10% or 20%, depending on your income. But you pay it every year, even if you held for 10 years. Portugal’s 365-day exemption is a major advantage.
- Netherlands: Crypto is taxed as personal wealth, not as income or gains. Rates vary based on asset value. Complex and unpredictable.
Portugal stands out because it rewards patience. If you’re not actively trading, you’re essentially exempt. That’s rare in Europe. It’s why digital nomads still flock there - even after the 2023 changes.
What’s Changing? The Future of Crypto Tax in Portugal
The 2023 rules were meant to be stable. But the world is changing. The EU’s Markets in Cryptoassets Regulation (MiCAR) rolls out fully in 2026. It won’t override Portugal’s tax rules - countries still control taxation - but it will force more transparency. Exchanges operating in Portugal will need to report user transactions to tax authorities. That means the days of flying under the radar are ending.Right now, the Portuguese tax authority (AT) doesn’t have the tools to track every crypto wallet. But they’re building them. By 2027, expect automated reporting from exchanges like Binance, Coinbase, and Kraken to feed directly into Portugal’s tax system. If you didn’t report staking rewards from 2025, you’ll likely get a letter.
Another area under review: professional activity thresholds. The €200,000 cap on the 15% simplified rate might drop. Experts believe the government will lower it to €100,000 by 2027 to capture more revenue from high-volume traders. That would hit serious traders hard - but it’s not guaranteed.
Staking taxation might also shift. Currently, you’re taxed only on conversion. But the EU is pushing for taxation at the moment rewards are received. Portugal may follow suit. If that happens, you’d owe tax on your 0.5 ETH staking reward the moment it lands in your wallet - even if you never sell it. That’s a big change. Watch for updates in late 2026.
What You Need to Do Right Now
If you’re in Portugal and holding crypto, here’s your action plan:- Track your purchase dates. Use a tool like CoinTracking, Koinly, or even a simple spreadsheet. You need to prove you held for over 365 days if you want to avoid tax.
- Separate your activities. Are you trading daily? That’s Category B. Are you staking ETH? That’s Category E. Don’t mix them. Mixing can trigger audits.
- Don’t assume you’re exempt. Just because you’re not a Portuguese resident doesn’t mean you’re off the hook. If you’re a non-resident and your exchange is based in Portugal, you may still owe tax on short-term gains.
- Keep records of all conversions. Every time you turn crypto into euros, save the transaction ID, date, and amount. That’s your proof.
- Know your residency status. Portugal’s tax rules apply differently to residents vs. non-residents. If you’re here on a D7 visa or digital nomad permit, you’re likely a tax resident. That means you owe tax on worldwide income - but the crypto rules still apply the same way.
Common Mistakes People Make
Most people think crypto tax in Portugal is simple. It’s not. Here are the top errors:- Assuming all crypto is tax-free. Only long-term capital gains are. Staking? Not free. Trading? Not free. Mining? Not free.
- Ignoring FIFO. You can’t pick which coins you sold. The system assumes you sold the oldest ones first. That can hurt if your first purchase was expensive.
- Not declaring staking rewards. If you earned 100 USDT from staking and never sold it, you think you’re safe. Wrong. If you convert it in 2026, you owe tax on that 2026 sale - even if the reward was earned in 2024.
- Using non-EU exchanges. If your exchange is based in the U.S. or Singapore, you might lose the long-term exemption. Always check where your exchange is legally registered.
Who Should Still Consider Portugal?
Portugal isn’t for everyone. But if you fit this profile, it’s still one of the best places in Europe:- You buy crypto and plan to hold it for at least a year.
- You’re not trading more than 2-3 times a month.
- You’re not running a mining farm or professional trading operation.
- You want a stable, predictable tax environment.
- You’re a digital nomad who values low taxes and high quality of life.
If you’re a high-frequency trader or miner, the 28% short-term rate and complex reporting might make places like Malta or Estonia more appealing - even if they don’t offer the same long-term exemption.
Is crypto still tax-free in Portugal?
Only if you hold it for more than 365 days and sell it for euros. Short-term gains (under a year) are taxed at 28%. Staking, lending, and professional trading are also taxable. Portugal is no longer a full tax haven - but it still offers one of the best long-term exemptions in Europe.
Do I pay tax if I trade crypto for another crypto?
No, crypto-to-crypto trades are not taxable in Portugal. You only owe tax when you convert crypto into euros or another fiat currency. That’s a major advantage over countries like the UK or Germany, where every trade is a taxable event.
What happens if I don’t report my crypto gains?
Right now, enforcement is light. But that’s changing fast. By 2027, exchanges will report your transactions directly to the Portuguese tax authority. If you didn’t report gains from 2025 or 2026, you could face back taxes, penalties, and interest. It’s not worth the risk.
Can I use a non-EU exchange and still get the 0% long-term tax rate?
Only if you’re a Portuguese tax resident and your crypto is held in a wallet you control. The exemption applies to the taxpayer, not the exchange. But if your exchange is based outside the EU and you’re not a resident, the tax authority may challenge your claim. To be safe, use EU-based exchanges like Bitpanda or Kraken EU.
Do I need to file a tax return if I only made long-term gains?
Technically, no - if you only had tax-free long-term gains and no other taxable income, you don’t need to file. But if you have any other income, or if you’re a tax resident, it’s wise to file a return and declare your crypto activity. This creates a paper trail and reduces audit risk.