Every year, it’s the same thing: you will have to fill in your tax form. However, there are surely novelties for the subject that particularly interests us here: cryptocurrencies. This is indeed the case for 2022, and there is no doubt that you will have to be particularly attentive for your 2021 income tax return. In short, let’s take stock together.
The operation of the declaration of cryptocurrencies on the 2022 tax form
Before getting to the heart of the matter, it is appropriate to take stock for new declarants or a reminder shot for older ones. The first thing to integrate is that all your cryptocurrencies are not taxed. In effect, only capital gains greater than €305 converted into real currency (in euros for example) are. So, even if you made a huge capital gain in cryptocurrency in the year 2021, you will not be taxed on it in 2022, unless you converted it into fiat (real) currency. Please note: if you have purchased real property with your cryptocurrency, and then resold it, you will be taxed on this resale, if it corresponds to a capital gain on your crypto.
In terms of taxation, the rate applied is deliberately clear, this is flat tax : you will therefore be taxed at 30% on the capital gain. This tax is made up of two elements:
- 17.2% social security contributions
- 12.8% tax
Finally, it is good to know that in 2023 things will change a bit. You will have the choice, either to keep the system of this flat tax for your cryptocurrencies, or to go through a progressive scale which may prove to be more interesting. Anyway, we will come back to it when the time is right.
Do not forget anything: even for the smallest transaction
Now that the procedure is explained, you will have to complete your 2022 tax form and include your income from cryptocurrencies. Whether you have realized a capital gain or not, you are obliged to add all the transactions carried out during the previous year. Of course, if you have made a lot of purchases, you will have your work cut out for you when you make your declaration!
To share all your transactions with the tax authorities, you will need to download a specific form: this is Cerfa 2086. Note that if you file your declaration on the internet, the capital gain (or loss) of the transactions will then be calculated automatically via form 2042. This allows you to complete your declaration more quickly, and to avoid a calculation error on your part. Finally, it is useful to remember that you must mention any presence of foreign account(s). If you have a cryptocurrency account with Coinbase, for example, you will need to mention it.
The specifics of the 2022 tax return for 2021 income
Now let’s get into what interests us most in this article: the most important points of your 2022 tax return in connection with cryptocurrencies.
First point: the lending of cryptocurrencies. As a reminder, this technique consists of lending all or part of your capital in crypto to obtain interest. Just like cryptocurrency transactions, income is taxable at 30%, still according to the flat tax, only if you use centralized platforms as can Binance. To declare this income, you will have to fill in box 2TR of form 2042. Conversely, if you use decentralized platforms, called staking, you will not be taxed. Again, it’s quite specific, it’s up to you to clearly differentiate the type of loan you have made.
Second important point for 2022: NFTs. A real explosion for a few months now, a legal vagueness is still in order on this side. Indeed, should we consider NFTs as real investments, or rather as works of art? If you have made gains in NFT in 2021, you have two possibilities:
- If you have made less than €5,000 in winnings, you are not obliged to declare them.
- If you have made more than €5,000, we advise you to contact your tax office, or otherwise a tax lawyer.
Be careful though! Again, these earnings must be made in fiat currency to be taxed. If this is not the case, and you have kept everything in cryptocurrency like Bitcoin or Ethereum, you will not be taxed.