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Do you have to pay tax on your winnings from a Bitcoin Robot?
Many who trade bitcoin online realize when they start making big profits and high returns that they will have to withdraw the money from the platform and more often than not, it is not the case that the assets you actually put into the market are stored in crypto, but you trade instead with contracts whose underlying value is bitcoin or other cryptocurrencies.
This also means that profits are paid out in fiat currency and not cryptocurrency, which presents the problem for many that you are then obliged to declare the profit and thus pay tax according to the new 70% rule.
Profits from trading with bitcoin are therefore not taxed like other investments such as funds or shares.
Most brokers, however, have licenses to conduct their trade that are not issued in Sweden or by Swedish regulatory authorities, but often European ones from Cyprus, or Australia, which means that the tax authorities do not automatically have any insight into how your capital is managed, and thus they cannot request out control data with the aim of uprating you.
It is only when you withdraw the money from the broker’s platform to an account in Sweden that you are partly obliged to declare your profit.
We advise against any type of criminal activity or intent and we recommend that you always follow the rules and laws that apply in the country where you are registered or reside and have your economic domicile.
How can I optimize my tax for Bitcoin?
Instead of avoiding tax, there are legal ways to optimize the tax, this does not mean tax evasion as long as it is done according to the law.
For example, you can create a company in Dubai that holds your Bitcoins and manages your capital. A limited liability company or an LLC company, as it is called abroad, is infinitely responsible for its resources, unlike a Swedish limited liability company. You therefore do not own the assets in a limited liability company, the company itself does, you only own shares in the company.
Dubai is zero percent tax for cryptocurrencies and if you want to use the budget option in the neighboring emirate, it is Ras al Kheimah that applies. The tax picture does not change and you can spend with the company’s money even in Sweden. It goes without saying that the assets belong to the company even when you spend, but in many cases it can be safer than owning them as an individual in Sweden.
You can set up a foundation in Panama
Foundation in Panama works just like a British Trust except that you have more insight and better control over the assets without them being in your own name, so you don’t own the assets just like in Dubai. Under your foundation is an LLC company that enters into agreements with real estate companies or stock brokers so that you can once again invest and minimize your tax in Sweden.
You can set up an offshore company for the management of your Bitcoins
An offshore company does not have to cost a lot, it can be enough with EUR 1500 who owns your account on Binance for example, now it is the company that has a tax obligation and not you as a private person.
A company in St. Vincent & the Grenadines has no accounting duty or tax liability for assets earned outside the country. There will therefore be no extra work to have an offshore company and no costs for bookkeeping.
You pay a premium per year that you have the company to keep it active and the assets no longer belong to you so you are not hiding any assets.
You can combine a Panama foundation with a company in St Vincents & Grenadines and in this way you will not become the UBO (Ultimate beneficial owner) for the capital against which a future wealth tax can be applied.
The trust’s “beneficiaries” can easily be changed to your children without the capital leaving the trust and they can borrow from the trust for new investments and pay interest back to the trust from future returns.
It is one hundred percent legal to give away a gift in a gift deed to, for example, a foundation, which means that you do not pay tax on your Bitcoin gift at all, neither now nor in the future. Neither you nor your family should have to be taxed because you took a risk in life and became very rich, but do it in a smart and legal way.