Tax on crypto transactions

How are cryptocurrencies taxed in Singapore?


  • "It depends on the type of activity that is being carried out:
    For trading in cryptocurrency in the ordinary course of business, profits would be subject to income tax.
    For purchase of cryptocurrencies for long-term investments, capital gains would not be subject to tax.
    For payment of cryptocurrencies for goods or services, the provider of the goods or services would be taxed on the value of the goods or services because the cryptocurrencies would be treated as intangible property and not legal tender."

    Income Tax Treatment of Digital Tokens 

    For Income Tax purposes:

    According to IRAS
    last revised on 17 November 2021

    Tax Treatment of Digital Tokens
    Businesses that choose to accept digital tokens such as Bitcoins for their remuneration or revenue or that trade in digital tokens are subject to normal income tax rules.
     
    Digital Tokens Received as Payment
     
    Businesses that choose to accept digital tokens such as Bitcoins for their remuneration or revenue are subject to normal income tax rules. They are taxed on the income derived from or received in Singapore. Tax deductions are allowed, where permissible, under our tax laws.
     
    Generally, these businesses should record the sale based on the open market value of the goods or services in Singapore dollars. The same applies for businesses which pay for goods or services using digital tokens.
     
    If the open market value of the goods or services that would have otherwise been exchanged in Singapore dollars cannot be determined (e.g. the good or service is only traded with digital tokens), the digital token exchange rate at the point of the transaction may be used.
     
    Learn more about the tax treatment of digital tokens received as payment (PDF, 236KB).
     
    Buying and Selling Digital Tokens
     
    Businesses that buy and sell digital tokens in the ordinary course of their business are taxed on the profit derived from trading in the digital token. Profits derived by businesses which mine and trade digital tokens in exchange for money are also subject to tax.
     
    Businesses that buy digital tokens for long-term investment purposes may enjoy capital gains from the disposal of these digital tokens. However, as there are no capital gains taxes in Singapore, such gains are not subject to tax.
     
    Whether gains from the disposal of digital tokens are trading or capital gains depends on the facts and circumstances of each case. Factors such as purpose, frequency of transactions, and holding periods are considered when determining if such gains are taxable.
     
    Learn more about the tax treatment of digital tokens (PDF, 236KB).