Cryptocurrency Taxation in Taiwan: What You Need to Know in 2025

When you buy Bitcoin on BitoPro or sell Ethereum on MaiCoin, you might think you're just trading digital assets. But in Taiwan, every trade could trigger a tax bill. The government doesn't treat cryptocurrency like cash, but it also doesn't ignore it. Right now, your crypto gains are taxed under old rules meant for traditional business and income - and that’s causing confusion for thousands of traders.

How Taiwan Classifies Cryptocurrency

Taiwan doesn’t call cryptocurrency money. The Financial Supervisory Commission (FSC) has labeled it a "virtual commodity" since 2014. That classification matters because it means no one can use Bitcoin to pay for coffee legally, but it also means trading it falls under existing tax laws. The Ministry of Finance (MOF) hasn’t created new crypto-specific tax codes. Instead, they’re stretching old ones to fit.

This creates a gray zone. If you’re buying and selling crypto like a business, you’re subject to business tax. If you’re holding and selling for profit, you’re subject to income tax. But there’s no clear line between "hobby trader" and "professional trader." And if you don’t keep records of your purchase price? The tax office has no way to calculate your gain - and neither do you.

Business Tax (VAT): 5% on Sales

Taiwan applies a 5% value-added tax (VAT) to cryptocurrency trading revenue. It’s not about profit - it’s about sales. If you sell crypto for NT$100,000, you owe NT$5,000 in VAT, regardless of whether you made a profit or lost money.

Here’s how it breaks down:

• Taiwanese individuals: If you trade crypto regularly and make over NT$40,000 per month (~US$1,300), you must register as a business and pay 5% VAT on all sales. Below that threshold? You’re exempt.
• Taiwanese businesses: Any company selling crypto on a local platform must charge and remit 5% VAT. No exceptions.
• Foreign sellers: If you’re based overseas but sell to Taiwanese individuals, you must register for VAT if your sales to them exceed NT$40,000/month. If you only sell to Taiwanese businesses, you’re off the hook - because the buyer pays the tax.

Many traders assume they’re safe if they use Binance or another offshore exchange. That’s a myth. If you’re a resident of Taiwan and your monthly sales hit the NT$40,000 threshold, you’re still liable. The tax office doesn’t care where the exchange is located - they care where you live and how much you’re trading.

Income Tax: Up to 20% on Profits

On top of VAT, you might owe income tax. If the tax office decides your crypto activity is a business - or even a serious side hustle - your net profit is added to your annual income and taxed at progressive rates, up to 20% for higher earners.

The real problem? Proving your cost basis.

Let’s say you bought 1 BTC in 2020 for NT$500,000. You sold it in 2024 for NT$3,000,000. Your gain is NT$2,500,000. Simple, right? But what if you lost your transaction history? What if you bought through a peer-to-peer trade with no receipt? What if you swapped one altcoin for another without cashing out?

Taiwan’s tax system doesn’t have a built-in way to track crypto purchases. Unlike stock brokers who issue 1099 forms, crypto exchanges in Taiwan don’t automatically report cost basis to the tax authority. That means you’re responsible for keeping every single transaction record - wallet addresses, timestamps, fiat equivalents, and proof of purchase. If you can’t prove what you paid, the tax office can assume your entire sale amount is profit. That’s a nightmare for anyone who’s been trading since 2017.

Who’s Regulating This?

The FSC and MOF are the two main players. The FSC handles licensing and anti-money laundering (AML) rules. The MOF handles the money - meaning taxes.

In 2021, Taiwan adopted FATF guidelines and started requiring all crypto exchanges operating locally to register as Virtual Asset Service Providers (VASPs). Today, 24 platforms are officially approved, including BitoPro, MaiCoin, and Binance’s local operations. These platforms must verify user identities, segregate customer assets, and implement cybersecurity standards.

But here’s the catch: registration doesn’t mean tax compliance. The FSC doesn’t share trading data with the MOF. That’s why the MOF is waiting. They’ve said clearly: once all VASPs fully implement real-name verification systems - which they’re now doing - they’ll introduce specific crypto tax reporting rules.

That change is coming. In November 2024, the MOF publicly announced it was reviewing crypto taxation rules. Why? Because prices surged after the U.S. election, and trading volume in Taiwan jumped 300% in just three months. The old system is crumbling under the weight of activity.

Legal Ambiguities and Court Cases

It’s not just tax law that’s unclear - the whole legal landscape is shifting.

In one high-profile case, a Taiwanese company was prosecuted under the Banking Act for accepting Bitcoin as payment. The court ruled Bitcoin isn’t "funds" under the law, so no banking violation occurred. But in another case, a different court found the same activity illegal. That inconsistency makes it risky for businesses to accept crypto as payment.

Even worse, some crypto-related fraud cases are being prosecuted under old fraud statutes. There’s no specific law for crypto scams. Prosecutors are using whatever fits - and that means you could be charged with fraud for something that’s not even clearly illegal.

Until Taiwan passes a dedicated Virtual Asset Act, the legal status of crypto remains in limbo. And that uncertainty trickles down to tax compliance. If you don’t know if your activity is legal, how can you know if it’s taxable?

What You Should Do Right Now

Don’t wait for the government to send you a letter. If you’re trading crypto in Taiwan, here’s what you need to do today:

1. Track every transaction: Use a crypto tax tool like Koinly or CoinTracker. Export all wallet addresses, dates, amounts, and fiat values. Keep screenshots of purchase receipts and trade confirmations.
2. Know your threshold: If your monthly sales exceed NT$40,000, register for VAT. File quarterly returns even if you think you’re small-time.
3. Report gains: Even if you’re not required to register for VAT, if you made a profit, include it in your annual income tax return. Don’t assume the tax office won’t find out - they will.
4. Don’t trust exchanges: Binance, BitoPro, MaiCoin - none of them report your cost basis to the tax office. You are your own accountant.
5. Prepare for change: The MOF will soon require VASPs to report user transaction data. When that happens, your records will be cross-checked. If yours are incomplete, you’ll be penalized.

What’s Next for Taiwan’s Crypto Tax Rules?

The writing is on the wall. Taiwan is moving toward full integration of crypto into its financial system. Real-name verification is nearly complete across all major platforms. The FSC is tightening oversight. The MOF is preparing to enforce.

Expect a new tax law by mid-2026. It will likely:

• Require exchanges to report annual transaction summaries to the tax authority
• Define clear rules for calculating cost basis and capital gains
• Introduce a specific crypto tax form
• Clarify whether staking, lending, and DeFi activities are taxable

Until then, you’re operating in a gray zone. But gray zones don’t last forever. The longer you wait to get your records in order, the bigger your risk.

One trader in Taipei lost NT$1.2 million in penalties after the tax office audited his BitoPro account. He had no purchase records. He claimed he "bought crypto years ago" and couldn’t prove it. The tax office assumed his entire sale amount was profit. He paid 20% income tax on NT$6 million - even though his real gain was under NT$1 million.

You don’t need to be a tax expert. But you do need to be organized. Start today. Keep your records. Don’t assume you’re invisible. In Taiwan, the tax office is watching.