Crypto Tax Italy: Ultimate Tax Guide for 2024

<div fs-richtext-component="info-box" class="info-box"><div class="flex-info-card"><img src="https://assets-global.website-files.com/65098a145ece52db42b9c274/650c6f4cef4c34160eab4440_Info.svg" loading="lazy" width="64" height="64" alt="" class="icon-info-box"><div fs-richtext-component="info-box-text" class="info-box-content"><p class="color-neutral-800">This guide incorporates the latest crypto regulations introduced into Italy's national legal system through the 2023 Budget Law.</p></div></div></div>

Do I Have to Pay Taxes on Cryptocurrencies in Italy?

Yes, in Italy, you have to pay taxes on crypto. There is a 26% tax on capital gains equal or over 2,000€, which are treated as "miscellaneous income." Gains up to 2,000€ are tax-free. 

Alternatively, you can opt for a 14% tax on the value of your crypto assets as of January 1.

<div fs-richtext-component="info-box" class="info-box"><div class="flex-info-card"><img src="https://assets-global.website-files.com/65098a145ece52db42b9c274/650c6f4cef4c34160eab4440_Info.svg" loading="lazy" width="64" height="64" alt="" class="icon-info-box"><div fs-richtext-component="info-box-text" class="info-box-content"><p class="color-neutral-800">Attention: Once you reach or exceed the 2,000€ limit, the entire amount becomes taxable.</p></div></div></div>

What Are the Tax Rates on Cryptocurrencies?

Capital Gains Tax

This tax is 26% on capital gains of 2,000€ or more per tax year, with gains below this amount being tax-free.

Alternative Portfolio Tax (Optional to The Capital Gains Tax)

The alternative portfolio tax allows you to pay a 14% tax on the value of crypto-assets held as of January 1, instead of the capital gains tax. 

According to Article 1, Paragraph 133 of the Budget Law 2023, this value can be used as the cost basis instead of the purchase value.

<div fs-richtext-component="info-box" class="info-box warning"><div class="flex-info-card"><img src="https://assets-global.website-files.com/65098a145ece52db42b9c274/650c6f473e84badfdd6e059e_Care.svg" loading="lazy" width="64" height="64" alt="" class="icon-info-box"><div fs-richtext-component="info-box-text" class="info-box-content"><p class="color-neutral-800">This value cannot be used to carry forward capital losses.</p></div></div></div>

This tax can be paid by 30 June in one lump sum or in 3 equal annual installments starting on 30 June. After the first installment, a 3% annual interest rate applies to the remaining installments.

Wealth Tax

For crypto assets held with an Italian intermediary, a 0.2% stamp duty is automatically deducted. If the assets are held with a foreign intermediary or in self-custody (e.g., Ledger), a 0.2% wealth tax applies annually instead. It is based on the portfolio value at the end of the year (31.12).

This tax applies to all Italian tax residents, with a maximum cap of 14,000€ for taxpayers different from natural persons.

Special Flat Tax for New Residents

Italy offers tax incentives for new residents, including crypto investors, to attract investment and human capital. These incentives include a special flat tax on foreign income, an inheritance, and gift tax exemption, and fast-tracked visas.

For crypto investors, most income from crypto investments can qualify for the Italian flat-tax regime as foreign income. Crypto capital gains may also be eligible, and certain tax reporting obligations, such as the RW Form, will be reduced.

The flat tax allows you to pay an annual flat tax of 100,000€ regardless of your foreign income level, with an additional 25,000€ for each family member.

To take advantage of these benefits, contact a tax professional for detailed guidance and optimal planning for your move to Italy.

How Do I Calculate Crypto Gains for the Tax Return?

Taxpayers must calculate their cryptocurrency gains and losses before submitting them to the Italian Revenue Agency. First, determine the cost basis, which is the amount paid to acquire the cryptocurrency and add any applicable fees. If traded, use its fair market value in EUR on the acquisition day. To calculate profit or loss, subtract the cost basis from the sale price. For swaps or other non-sale disposals, use the fair market value on the disposal day.

<div fs-richtext-component="info-box" class="info-box"><div class="flex-info-card"><img src="https://assets-global.website-files.com/65098a145ece52db42b9c274/650c6f4cef4c34160eab4440_Info.svg" loading="lazy" width="64" height="64" alt="" class="icon-info-box"><div fs-richtext-component="info-box-text" class="info-box-content"><p class="color-neutral-800">If you opt for the Alternative Portfolio Tax, the calculation is based on the value of crypto-assets held as of January 1.</p></div></div></div>

<div fs-richtext-component="info-box" class="info-box protip"><div class="flex-info-card"><img src="https://assets-global.website-files.com/65098a145ece52db42b9c274/650c6f4b151815fb0be48cec_Lightning.svg" loading="lazy" width="64" height="64" alt="" class="icon-info-box"><div fs-richtext-component="info-box-text" class="info-box-content"><p class="color-neutral-800">With Blockpit's cryptocurrency tax software, such calculations are fully automated for you. The days of tediously keeping track of your crypto transactions in an Excel file are over. Good riddance.</p></div></div></div>

What About Crypto Losses?

Trading Losses

Under Italian tax regulations, investors can deduct cryptocurrency trading losses exceeding 2,000€ from their profits and carry these deductions forward for up to five years. Using a loss-harvesting strategy can help reduce annual tax liabilities.

<div fs-richtext-component="info-box" class="info-box"><div class="flex-info-card"><img src="https://assets-global.website-files.com/65098a145ece52db42b9c274/650c6f4cef4c34160eab4440_Info.svg" loading="lazy" width="64" height="64" alt="" class="icon-info-box"><div fs-richtext-component="info-box-text" class="info-box-content"><p class="color-neutral-800">With Blockpit's tax optimization feature, discover new saving opportunities in your portfolio and improve your tax loss harvesting strategy. Try it now!</p></div></div></div>

Losses from Scams or Hacks

The Italian tax authority, Agenzia Entrate, has not provided clear guidance on whether losses from scams, hacks, or misplaced private keys are deductible as capital losses. Reporting such incidents to the authorities is essential. Consult a cryptocurrency accountant to determine if these losses can be claimed as capital losses.

The Accounting Methods for Crypto Tax in Italy

In Italy, the Last In, First Out (LIFO) method is used for cryptocurrency transactions. This means that the most recently acquired coins are considered the first to be sold.

Let’s look at an example:

1. Chris buys 1 BTC for 3,000€ on January 1st.
2. He buys another BTC for 2,000€ on February 1st.
3. Chris sells 1 BTC for 4,000€. Using LIFO, the cost basis is 2,000€ from the BTC bought on February 1st, realizing a gain of 2,000€.

Another method is FIFO (First In, First Out), which is not used in Italy. The image below illustrates the difference.

How to File a Tax Return for Cryptocurrencies

First, here is the required data for your tax report:

• Transaction dates
• Cryptocurrencies involved
• Type of transaction
• Amounts involved
• Value of transactions in EUR
• Gain or loss from transactions

<div fs-richtext-component="info-box" class="info-box protip"><div class="flex-info-card"><img src="https://assets-global.website-files.com/65098a145ece52db42b9c274/650c6f4b151815fb0be48cec_Lightning.svg" loading="lazy" width="64" height="64" alt="" class="icon-info-box"><div fs-richtext-component="info-box-text" class="info-box-content"><p class="color-neutral-800">With Blockpit's cryptocurrency tax software, data collection is fully automated. Say goodbye to the tedious task of tracking your crypto transactions in an Excel file. Good riddance.</p></div></div></div>

Italian taxpayers need to use one of two forms, with different deadlines, depending on the nature of their income:

Modello 730

The Modello 730 form is primarily for those with employment income, credits, or deductions to declare or claim. This form is suitable for individuals who do not need to report complex income sources like significant capital gains or foreign assets.

Modello Redditi PF

The Modello Redditi PF is used for more complex tax situations, including reporting capital gains from cryptocurrencies. This form is applicable for those who need to declare employment income, tax withheld, capital gains, or foreign income and assets.

Form RT: Included within the Modello Redditi PF to report capital gains from crypto transactions.

Form RW: Included within the Modello Redditi PF to report foreign income and assets.

<div fs-richtext-component="info-box" class="info-box"><div class="flex-info-card"><img src="https://assets-global.website-files.com/65098a145ece52db42b9c274/650c6f4cef4c34160eab4440_Info.svg" loading="lazy" width="64" height="64" alt="" class="icon-info-box"><div fs-richtext-component="info-box-text" class="info-box-content"><p class="color-neutral-800">You can file both forms online, through tax assistance centers (CAF), or with authorized professionals.</p></div></div></div>

When Is the Tax Return Due?

The tax year in Italy runs from January 1 to December 31. The deadlines for filing your tax return depend on the forms you need.

For the Modello 730, the deadline is September 30 of the following year. For example, if you are filing a tax return for the year 2023, the deadline is September 30, 2024.

For the Modello Redditi, which consists of Form RT (for capital gains) and Form RW (for foreign income/assets), the deadline is October 15 of the following year.

<div fs-richtext-component="info-box" class="info-box"><div class="flex-info-card"><img src="https://assets-global.website-files.com/65098a145ece52db42b9c274/650c6f4cef4c34160eab4440_Info.svg" loading="lazy" width="64" height="64" alt="" class="icon-info-box"><div fs-richtext-component="info-box-text" class="info-box-content"><p class="color-neutral-800">Non-resident individuals who are abroad at the time of filing their tax return and are unable to submit it electronically can send the “Modello Redetti” form by registered mail or another equivalent method by November 30 of the year following the tax year.</p></div></div></div>

<div fs-richtext-component="info-box" class="info-box protip"><div class="flex-info-card"><img src="https://assets-global.website-files.com/65098a145ece52db42b9c274/650c6f4b151815fb0be48cec_Lightning.svg" loading="lazy" width="64" height="64" alt="" class="icon-info-box"><div fs-richtext-component="info-box-text" class="info-box-content"><p class="color-neutral-800">Tax advisors also appreciate Blockpit's tax reports! They save a lot of work—and save you money!</p></div></div></div>

How to Optimize Taxes on Crypto?

Here are several (legal) strategies to reduce your crypto tax obligations in Italy:

• Hold Your Crypto: If you don’t sell, you aren’t subject to gains.
• Utilize Losses: Losses over 2,000€ from crypto investments can be deducted from profits and carried forward for up to five years.
• Make a Tax-Deductible Donation: Individual and corporate donors can deduct contributions from their income tax up to 10% of their declared income, with a maximum of 70,000€ per tax year.
• Leverage the Alternative Portfolio Tax: Opt to pay a 14% tax on the value of the assets held as of January 1 of the next year instead of the purchase cost. This encourages taxpayers to report crypto on their taxes.

Your Crypto Tax Report with Blockpit

Quickly and easily create your personal crypto tax report with the Blockpit crypto tax calculator, available as a convenient PDF.

Blockpit adheres to Italian tax regulations, ensuring all your transactions are legally categorized and assigned correctly.

In addition to pre-filled tax forms, Blockpit also generates a detailed transaction report listing all tax-relevant transactions, which can be presented to the tax office upon request.

When Are Crypto Taxes Not Applicable?

<div fs-richtext-component="tax-status-tax-free" class="tax-status-pills tax-free"><div>Tax Free</div></div>

The following scenarios do not trigger a taxable event:

• Yearly crypto gains under 2,000€
• Transferring crypto between wallets
• Buying crypto with euros
• Converting one crypto to another, including stablecoins

<div fs-richtext-component="info-box" class="info-box"><div class="flex-info-card"><img src="https://assets-global.website-files.com/65098a145ece52db42b9c274/650c6f4cef4c34160eab4440_Info.svg" loading="lazy" width="64" height="64" alt="" class="icon-info-box"><div fs-richtext-component="info-box-text" class="info-box-content"><p class="color-neutral-800">Conversions into stablecoins like USDT are debated. European regulation defines stablecoins as E-Money Tokens (EMTs), which are taxable. However, no stablecoin currently meets EMT criteria, so USDT conversions should be tax-neutral.</p></div></div></div>

Taxation of Basic Transactions

Selling Crypto for Fiat

<div fs-richtext-component="tax-status-capital-gains-tax" class="tax-status-pills"><div>Capital Gains Tax</div></div>

Selling cryptocurrencies for fiat currencies, such as the Euro or Dollar, is taxable if gains exceed 2,000€ during the fiscal year.

Using Crypto to Pay for Goods or Services

<div fs-richtext-component="tax-status-capital-gains-tax" class="tax-status-pills"><div>Capital Gains Tax</div></div>

Using cryptocurrencies for payments, is taxable if gains exceed 2,000€ during the fiscal year.

Receiving Crypto as Payment for Goods or Services

<div fs-richtext-component="tax-status-capital-gains-tax" class="tax-status-pills"><div>Capital Gains Tax</div></div>

Receiving cryptocurrencies as payment, is taxable if gains exceed 2,000€ during the fiscal year.

Bitcoin Mining

Currently, there is no specific regulation regarding Bitcoin mining in Italy. Receiving BTC through mining is likely not a taxable event for individuals. However, when individuals sell the mined cryptocurrency, it should be reported as general income. 

If mining is considered a business activity, it changes the tax implications. In such cases, the sale of mined cryptocurrency might be subject to the Italian individual business income tax regime, with progressive rates ranging from 23% to 43%. Additionally, BTC received through mining might be subject to a 24% corporate tax on their market value upon receipt.

Airdrops

<div fs-richtext-component="tax-status-capital-gains-tax" class="tax-status-pills"><div>26% AT DISPOSAL</div></div>

The tax treatment of airdrops in Italy is not fully clarified due to a lack of specific regulation. It is likely that receiving airdrops is not a taxable event. However, selling airdrops for fiat may trigger a 26% capital gains tax.

Hard Forks

<div fs-richtext-component="tax-status-capital-gains-tax" class="tax-status-pills"><div>26% AT DISPOSAL</div></div>

The tax treatment of hard forks in Italy remains uncertain due to a lack of specific regulations. It is likely that receiving hard forks is not a taxable event. However, selling hard forks for fiat may be subject to a 26% capital gains tax.

Receiving Crypto as Gift

<div fs-richtext-component="tax-status-capital-gains-tax" class="tax-status-pills"><div>26% AT DISPOSAL</div></div>

The tax treatment of receiving crypto as a gift in Italy is not fully clarified due to a lack of specific regulations. It is likely that receiving crypto as a gift is not a taxable event. However, selling the gifted crypto for fiat may be subject to a 26% capital gains tax.

Bounties

<div fs-richtext-component="tax-status-income-tax" class="tax-status-pills"><div>26% ON INFLOW</div></div> <div fs-richtext-component="tax-status-income-tax" class="tax-status-pills"><div>26% ON SALE</div></div>

The tax treatment of receiving bounties in Italy is unclear due to a lack of specific regulations. It is likely that bounties are taxed at 26% of their fair market value upon receipt, with a 26% tax on any gains upon disposal.

Taxation of DeFi Transactions

Staking

<div fs-richtext-component="tax-status-income-tax" class="tax-status-pills"><div>26% ON INFLOW</div></div> <div fs-richtext-component="tax-status-income-tax" class="tax-status-pills"><div>26% ON SALE</div></div>

The tax treatment of staking rewards in Italy is unclear due to a lack of specific regulations. The 2023 Budget Law suggests that income from holding crypto-assets, which might include staking rewards, is taxed at 26% without deductions. Therefore, it is likely that staking rewards are taxed at 26% upon receipt and any gains upon disposal are also taxed at 26%.

Lending

<div fs-richtext-component="tax-status-income-tax" class="tax-status-pills"><div>26% ON INFLOW</div></div> <div fs-richtext-component="tax-status-income-tax" class="tax-status-pills"><div>26% ON SALE</div></div>

The tax treatment of lending rewards in Italy is unclear due to a lack of specific regulations. The 2023 Budget Law suggests that income from holding crypto-assets, including lending rewards, is taxed at 26% without deductions. Therefore, it is likely that lending rewards are taxed at 26% upon receipt, and any gains upon disposal are also taxed at 26%.

Taxation of NFT Transactions

The tax treatment of NFTs in Italy remains uncertain, with no specific rules defining NFTs as representing any underlying assets.

It's likely that no taxes are due upon the creation of NFTs. However, the costs involved in creating NFTs should be included in the taxable basis if the creator qualifies as a professional.

Converting NFTs into another cryptocurrency (e.g., trading NFTs for ETH) or vice versa (crypto to NFT) is likely considered a taxable event, resulting in capital gains or losses.