Financial entities enforce monitoring of cryptocurrencies through implementation of three compulsory models for all investors.
In a bid to promote transparency and legality in the cryptocurrency sector, the Spanish Tax Agency has introduced three new tax models: 100, 714, and 721. This move positions Spain as one of the European leaders in the adoption of Bitcoin and other digital assets.
**Modelo 100: General Income and Capital Gains Tax**
Income from activities such as cryptocurrency mining, staking, salary, or DeFi yield is taxed as general income, with rates ranging from 24% to 47% when combining state and regional taxes. Gains from cryptocurrency disposals (sales, swaps, etc.) are taxed as savings income. The tax rates for 2025 are progressive, with rates ranging from 19% to 28%. Residents must file Modelo 100 to report these income sources.
**Modelo 714: Wealth Tax**
While Modelo 714 is generally used for wealth tax, it applies to assets exceeding €700,000 after allowances, with rates from 0.2% to 3.5%. Cryptocurrencies are considered assets for wealth tax purposes if they contribute to exceeding the threshold.
**Modelo 721: Foreign Assets Declaration**
If a taxpayer has foreign cryptocurrency assets exceeding €50,000 on December 31st, they must submit Modelo 721. This form requires personal and financial details, including the company name if applicable. This model ensures transparency and compliance for foreign assets, including cryptocurrency portfolios held abroad.
**General Obligations**
Taxpayers must keep records for at least four years. Given Spain's proposed law to require exchanges to share user data, compliance is becoming more stringent, with potential penalties for non-compliance. The explicit inclusion of cryptocurrencies within Model 714 shows the Tax Agency's desire for control over large fortunes with a digital presence. These measures are also aligned with European policies against fraud and money laundering.
To aid cryptocurrency users, BIT2ME TAX can help with income tax, and a free certificate course is available on Bitcoin and other cryptocurrency taxation in Spain. Compliance with these new tax rules is fundamental for cryptocurrency users to avoid problems and penalties.
[1] Tax rates are subject to change and may vary by region. [2] More information can be found on the Spanish Tax Agency's official website. [3] Proposed law is yet to be passed and the exact details are subject to change.
- Investing in cryptocurrency is subject to various taxes in Spain, including General Income and Capital Gains Tax, Wealth Tax, and Foreign Assets Declaration, which aim to ensure transparency and combat fraud and money laundering in the personal-finance sector.
- For those engaged in cryptocurrency activities such as mining, staking, or DeFi yield, the General Income and Capital Gains Tax applies, with tax rates ranging from 24% to 47% for general income and 19% to 28% for savings income in 2025.
- Technology plays a crucial role in these tax models, as it enables the Spanish Tax Agency to keep track of and control large personal fortunes with a digital presence, such as cryptocurrencies and foreign assets.
