Danish Supreme Court Judges Issue Two Judgments on Whether to Sell Bitcoin, Qualify as a taxable event in certain circumstances.
In a notice dated March 30, the Danish Supreme Court said that a party profiting from the sale of bitcoin obtained through multiple purchases and donations must report the sale as a taxable event, adding that the purchases were made “for speculative purposes.” ". In another case, a court ruled that users who mine their own BTC and then sell their bitcoins would be subject to the same tax considerations.
Both cases before the Supreme Court involved the acquisition of BTC from 2011 to 2013 and its sale from 2017 to 2018, at prices differing by thousands of dollars. Citing parts of the country's National Tax Code, the court noted that it considered the intent of the first seller to ultimately sell the coins based on a 2011 Bitcoin forum post. "The Supreme Court has ruled that bitcoins received must be considered acquired assets in order for future turnover to be an integral part of [the first party's] business of developing and operating bitcoin software," the ruling said. “They cannot be deemed to have been transferred as [their] private property or assets at the time of sale. On this basis, the Supreme Court ruled that the bitcoins received for renunciation constituted income from [their] non-commercial business. Accordingly, the sale would trigger tax liability."
Coincub reported in September 2022 that Danish gains from cryptocurrencies could incur a tax rate of around 37 percent, but could be as high as 52 percent, depending on whether the user has a high income. Under its capital gains laws, that would put the country well above the U.S. crypto tax rate between 0% and 37%, depending on whether the taxpayer is selling assets held for more than a year or less and their income levels.
