Federal Tax Service of Russia Publishes Cryptocurrency Market Quotes to Assist Taxpayers

The Federal Tax Service (FTS) of Russia has published information on its official website on the «Cryptocurrency Mining» portal regarding market quotes for cryptocurrencies to assist taxpayers.

«The website of the Federal Tax Service features data on the market prices of digital currencies and the total daily trading volumes from foreign trading entities (exchanges) to help taxpayers determine their income from transactions involving digital currencies based on information from publicly available sources. This allows taxpayers to calculate their tax base for cryptocurrency transactions as of each date when income is recognized,» the agency stated.

The FTS also noted that income in the form of digital currency obtained through mining is classified as in-kind income, and the value of the digital currency is determined by its market quote on the date the income is actually received. According to the FTS, the date of actual income recognition in digital currency is when the individual acquires the right to manage it.

The agency reported that thanks to the new service, taxpayers can assess the value of the digital currency obtained through mining for income reporting, as well as calculate the cost basis for the sold digital currency derived from mining for expense reporting.

The FTS reminded individuals that income in the form of digital currency from mining is assessed based on its market price on the date the income is recognized. Information about reporting for cryptocurrency received from mining and calculating the tax base for cryptocurrency transactions is available on the «Mining Register» web page.

As of November 1, 2024, a law comes into effect in Russia that establishes rules and conditions for conducting mining activities. Both legal entities and individual entrepreneurs, as well as citizens of the Russian Federation, are permitted to engage in mining. However, legal entities and individual entrepreneurs must be listed in the FTS register. Citizens not registered as individual entrepreneurs may mine digital currency without being included in the register, provided they do not exceed the energy consumption limits set by the government. Under the law, all miners are required to report their obtained digital currency to the FTS.