Entrepreneurs who want to obtain a crypto license in Portugal can discuss and work with our local representatives. Below is information about how to open a cryptocurrency company in this country, plus other important business aspects. We mention that one of our company formation agents in Portugal can manage the registration formalities of a company on behalf of foreign businessmen.
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How to set up a cryptocurrency company in Portugal
LDA is the variant for limited liability company in Portugal and the most popular business structure in this country. It is suitable for opening a cryptocurrency company in Portugal, and below we review some of the formalities:
- EUR 5,000 is the minimum share capital for LDA in Portugal, deposited in the local bank account.
- Articles of Association are the main documents of the company, with details about shareholders, activities, internal rules, etc.
- One should create a business plan to present to the relevant authorities.
- One should obtain a Virtual Asset Service Provider (VASP) license in Portugal before starting the business.
- The company must be registered for the payment of taxes (VAT, corporate income tax, social contributions, etc.)
These are some of the formalities that you must follow to open a crypto company in Portugal. We remind you that you benefit from the support offered by our agents if you want to open a company in Portugal.
Steps for obtaining the crypto exchange license in Portugal
As mentioned above, you need to obtain a Virtual Asset Service Provider (VASP) license in Portugal in order to open the company. Let’s review some of the formalities involved:
- It is necessary to present the business plan.
- The documents of the newly established company are presented.
- Authorities require a “Certificate of no criminal record.”
- A resident director is required to apply for a crypto exchange license in Portugal.
- Proof of registration for payment of taxes in Portugal is provided.
- Banco de Portugal is the institution that supervises virtual currency and which, in collaboration with other authorities, issues a Virtual Asset Service Provider (VASP) license in Portugal.
Those who want more details about crypto exchange licenses can use our services in company formation in Portugal. One of our local agents can help investors set up a company in Portugal in the cryptocurrency field.
Tax modification concerning cryptocurrency in Portugal
The most recent changes to the legislation regarding cryptocurrency transfers bring a series of news to the attention of digital money users. Among them, the 28% tax rate applies to capital gains derived from crypto assets, if these are held for at least 365 days. In addition, tax rules were modified according to categories of crypto assets and gains as follows:
- Category G refers to gains arising from crypto assets transfers, except securities. Thus, these are tax exempt if crypto is held for less than one year and transferred in exchange for a payment made in another digital money available in Portugal.
- Category E of taxation involves revenues rising from cryptocurrency investments. This means that if returns are paid as crypto assets, the gain is levied under the Category G taxation as an alternative.
- Category B involves the taxation of crypto mining revenues, as well as incomes derived from validating crypto tokens. Taxation is imposed upon the transfer as payment.
As the taxation system for cryptocurrency in Portugal has been favorable recently, crypto markets are expected to suffer various fluctuations. In any case, those who want to open a crypto company in Portugal must also consider the changes made to the legislation, not before obtaining a Virtual Asset Service Provider (VASP) license in Portugal.
What is tax-loss harvesting in Portugal?
Crypto tax-loss harvesting can be defined as a strategy for reducing the amount of tax. In most cases, crypto company owners in Portugal prefer this option of reducing tax liability by selling virtual currency at a loss to balance possible capital gains from other types of investments. It can be said that it is an initiative with the specific purpose, of diminishing legal duties regarding the taxation of crypto companies in Portugal. Thus, entrepreneurs can focus on implementing other types of technologies in the company.
The EU’s MiCA Regulation applies in Portugal
Markets in Crypto-Assets (MiCA) is a set of laws imposed by the European Union, which undoubtedly applies in Portugal. With the help of these EU directives, Portugal aims to clarify the way crypto assets work and are managed, sustaining innovation at the same time. On the other hand, crypto companies in Portugal are expected to participate in cutting down the carbon footprint of cryptocurrencies and follow the reporting conditions imposed.
About National Blockchain Technology in Portugal
The Portuguese authorities have recently announced that they are working with specialists in the field to implement National Blockchain Technology. Practically, it is being studied how this technology can be implemented, for which a set of laws will be adopted to facilitate its use even better. Also, those interested in the implementation and development of virtual currency, have at their disposal, from 2020, Technological Free Zones. Here it can be tested various services and products related to blockchain technology and more.
Regarding the use of virtual currency in Portugal, we present some statistics:
- Over 2.37% of Portugal’s population uses cryptocurrency.
- Those who use cryptocurrency in Portugal are people under the age of 40.
- Bitcoin can be used as a currency in Portuguese casinos.
- There is a 28% tax rate on short-term gains for cryptocurrency transactions in Portugal, if assets are owned for more than a year.
We recommend those who want to do business in the Iberian Peninsula, such as crypto companies, to use our services, as well as those offered by our accountants in Portugal. Do not hesitate to contact our team if interested in company incorporation in Portugal.