This year, the Tax Code of Russian Federation officially recognized digital currency as property. It means that mining and trading operations with cryptocurrency are now subject to taxation.
What does it mean for miners?
The government has established a clear procedure for tax payments on income from mining and operations with digital currencies. Statutory tax reporting has been introduced for mining infrastructure operators. In addition, only legal entities and individual entrepreneurs included in a special registerwill be allowed to engage in mining in Russia. Individuals will be able to mine cryptocurrency without being included in the register only if they do not exceed the government-established energy consumption limits.
Here's how taxes are paid:
•Legal entity — profit tax at 20%;
•Individual entrepreneurs under the General Taxation System — personal income tax at 13-22%;
• Individual entrepreneurs under the Simplified Tax System — personal income tax at 6% when only income is taxed, and 15% when the tax base is defined under income minus expenses formula
•Individuals — personal income tax at 13-22%;
•Non-residents – personal income tax at 30%.
A failure to declare income from cryptocurrency transactions or giving false tax base figures result in a fine of 20% of the unpaid amount in case of unintentional violation or in the accrual of penalties and collection of outstanding tax amounts.
In order to minimize potential business risks, it is of vital importance to monitor changes in legislation and consult with tax experts well in advance.
Ivan Kosterin, Head of Accounting
What does it mean for miners?
The government has established a clear procedure for tax payments on income from mining and operations with digital currencies. Statutory tax reporting has been introduced for mining infrastructure operators. In addition, only legal entities and individual entrepreneurs included in a special registerwill be allowed to engage in mining in Russia. Individuals will be able to mine cryptocurrency without being included in the register only if they do not exceed the government-established energy consumption limits.
Here's how taxes are paid:
•Legal entity — profit tax at 20%;
•Individual entrepreneurs under the General Taxation System — personal income tax at 13-22%;
• Individual entrepreneurs under the Simplified Tax System — personal income tax at 6% when only income is taxed, and 15% when the tax base is defined under income minus expenses formula
•Individuals — personal income tax at 13-22%;
•Non-residents – personal income tax at 30%.
A failure to declare income from cryptocurrency transactions or giving false tax base figures result in a fine of 20% of the unpaid amount in case of unintentional violation or in the accrual of penalties and collection of outstanding tax amounts.
In order to minimize potential business risks, it is of vital importance to monitor changes in legislation and consult with tax experts well in advance.
Ivan Kosterin, Head of Accounting