Last August, the Portuguese Tax Authority (PTA) announced that Bitcoin and other cryptocurrencies will not be taxed in the European country, which means that people will not have to pay taxes on capital gains or VAT when making cryptocurrency buying and selling operations.
According to Portuguese media, the PTA said that an exchange of cryptocurrencies for real currency constitutes an exercise of services on demand and free of VAT.
Even though cryptocurrency trade and receipt of payments will not be taxable, companies still have to pay the capital gains tax (between 28% and 35%), in addition to any income tax related to employee payments in Bitcoin (this in case organizations and employees agree on salary payments in that digital currency).
It should be noted that, because this is recent news, there’s still no information on how companies will register Bitcoin payments on their balance sheets. Due to the nature of the asset and which is now treated as such, it’s presumed that accounting for payments in Bitcoin will be a complicated process for organizations.