PIT settlements for cryptocurrencies and related tax obligations

Every person who sold or purchased cryptocurrencies in 2024 should declare the income or expenses incurred in the PIT settlement for 2024, to be submitted by 30 April 2025. The exchange of cryptocurrencies for goods, services or property rights that are not virtual currencies must also be declared in the tax return.

Tax on cryptocurrencies and personal income tax returns in Poland – basic rules

In Poland, income from the sale of cryptocurrencies in exchange for payment is classified as income from capital and is subject to taxation at a rate of 19%.

In the annual PIT-38 tax return, the taxpayer is obliged to show the income from the sale of cryptocurrencies (including the exchange of cryptocurrencies for goods, services or property rights that are not virtual currencies) and the costs incurred in their acquisition.

The tax-deductible costs of selling cryptocurrencies include:

• documented expenses directly incurred for the purchase of cryptocurrencies,
• fees and commissions related to the sale of cryptocurrencies (e.g. exchange commissions, transaction fees).

Importantly, taxpayers can deduct the costs of acquiring cryptocurrencies incurred in previous years in their annual tax return if they were previously reported in the annual tax return and were not deducted in previous years.

What happens if a cryptocurrency exchange goes bankrupt?

One of the key problems that cryptocurrency investors may face is the bankruptcy of the exchange where they traded. Some investors manage to recover all or part of their cryptocurrencies after years of litigation.

As confirmed by the Director of the National Tax Information in issued interpretations[1], in the event of the sale of these cryptocurrencies in 2024 or in the future, the investor will incur income subject to 19% PIT.

However, this income can be reduced by the acquisition costs – the price paid for the acquisition of the virtual currency in a transaction made through the bankrupt exchange – as well as the commission and other fees related to the sale of the virtual currency.

However, it is important that these costs are confirmed by a relevant document, e.g. transfer confirmations to the bankrupt exchange.

Moreover, as the Director of the National Tax Information pointed out, if the acquisition costs were incurred before 2019, they did not have to be included in the annual tax return for the year in which they were incurred. This is due to the fact that the provisions of the PIT Act in force before 2019 did not impose such an obligation. As a consequence, these costs can only be settled in the tax return for the year in which the cryptocurrencies were sold.

PIT settlements for cryptocurrencies – what documents should you have?

Taking into account the current practice of authorities and regulations, in order to protect themselves against possible problems with the settlement of cryptocurrencies (acquisition costs) in the future, each investor should have proper documentation of expenses / transactions. This can be:

• confirmation of transfers to the cryptocurrency exchange,
• bank statements,
• invoices and receipts confirming the purchase of cryptocurrencies,
• transaction history from the exchange,
• exchange reports / bank reports.

The lack of the above documentation may result in the refusal of the tax authorities to recognise the costs, which, with significant profits in this respect, may turn out to be significantly disadvantageous for the investor.

How can we help you with your PIT return?

1. We will prepare an annual tax return in which we will show the income from the sale and/or the acquisition costs of cryptocurrencies.
2. We will check the correctness of the settlement of cryptocurrencies for previous years.
3. We will prepare an adjustment to the annual tax return for previous years in order to include all data correctly.
4. We will verify the possibility of deducting tax-deductible costs for cryptocurrency transactions in the annual tax return.
5. We will assess the tax obligations related to the sale of cryptocurrencies in the context of your tax residency.

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[1] Interpretation of the Director of the National Tax Information of 21 November 2024 (ref. 0114-KDIP3-1.4011.619.2024.2.AK).