Finnish Tax Administration Found €30 Million Worth Unreported Crypto Gains in 2023

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Sujha Sundararajan

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April 22, 2024 06:51 EDT

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Finland’s Tax authority has found profits from sales of unreported crypto gains in 2023, amounting to  €30 Million ($31.9 million). As a result, the EU nation has mandated reporting of income from the sale of mining digital assets.

Per a report from a local media outlet Verkkouutiset, in line with the tax supervision following the unreported tax gains last year, the authority has asked those who invested in virtual currencies to pay ten million euros in capital income tax.

“The amount found last year is large in euro terms, which indicates that the control works and is effective,” says Mika Siivonen, tax expert from the Finnish Tax Administration.

Besides paying taxes, individuals who have not declared their income are mandated to pay a tax increase and late penalties. Failing to this may lead to criminal sanctions, the report added.

According to the findings from the country’s tax authority, a total of 9,800 customers reported receiving crypto income in 2022. This is lower than that of 2021, which reported 16,000 customers.

“When the exchange rates of virtual currencies have been low, investors have sold less of their holdings than before or for some reason sales losses have not been declared for taxation.”

Crypto Income Receivers in Finland Still Fail to Declare Tax

Siivonen added that they have been receiving more information from crypto exchanges regarding the crypto transactions of Finnish customers.

Per the estimates, still a large portion of crypto income receivers fail to declare their income in question for taxation. The Tax Administration received the information from several foreign virtual currency exchanges through international data exchange.

“If you received income from the use or mining of virtual currencies in 2023, you must declare the income with a pre-filled tax return,” the report read.

Further, the income from cryptos is taxed as capital income, and cryptos received from mining is taxed as earned income. Additionally, virtual currencies sold at a loss should also be declared for taxation, it added.