Virtual currencies have emerged as a new class of financial assets, yet the investment ecosystem remains less mature compared to traditional markets like stocks and forex. New investors commonly ask two fundamental questions: Are cryptocurrencies legal? and Do I need to pay taxes?
Legality of Cryptocurrencies in Taiwan
Yes, cryptocurrencies are legal investment instruments in Taiwan. The Executive Yuan has designated the Financial Supervisory Commission (FSC) as the anti-money laundering (AML) authority for virtual asset service providers (VASPs) under the Money Laundering Control Act.
Key regulations include:
- AML/CFT Compliance for Virtual Currency Platforms
- KYCs for transactions ≥ NT$500,000
Currently, cryptocurrencies are treated as virtual commodities—no dedicated crypto tax laws exist beyond AML provisions.
Tax Obligations for Crypto Investors
1. Individual Investors
- No transaction tax for buying/selling cryptocurrencies
- Profits are taxable as "property transaction income" under personal consolidated income tax
Example:
Dong Dong earns NT$500K salary + NT$1M crypto profit = NT$1.5M taxable income
2. Professional Traders
- Businesses with monthly sales ≥ NT$40K must:
✅ Register for tax
✅ Pay business tax & corporate income tax
3. Offshore Income
- Foreign exchange withdrawals (e.g., USD wire transfers) count as overseas income
- NT$6.7M basic tax-free threshold applies
Smart Tax Strategies
👉 Maximize Your Crypto Tax Savings
- Hold without cashing out: No tax triggered if assets stay in crypto form
- Use crypto payments directly (e.g., Crypto.com Visa, online stores)
- Keep transaction records for cost basis calculations
FAQs
Q1: Is crypto-to-crypto trading taxable?
A: Not directly, but profits from eventual fiat conversions are taxable.
Q2: How are losses reported?
A: Declare them as "property transaction losses" to offset gains.
Q3: What if I receive crypto as payment?
A: Fair market value at receipt time becomes taxable income.
👉 Legally Reduce Your Crypto Tax Burden
Always consult a tax professional for case-specific advice.