Understanding Crypto Taxation in France
Reporting cryptocurrency income is mandatory for French residents under tax regulations established by the Direction Générale des Finances Publiques (DGFiP). Whether you’re trading Bitcoin, earning staking rewards, or receiving NFT income, France treats crypto as taxable property. Failure to declare can result in penalties up to 80% of owed taxes plus interest. This guide explains the step-by-step process to remain compliant.
Step-by-Step Declaration Process
- Determine Your Tax Category
French tax law distinguishes between:- Occasional Traders (BIC): Taxed under capital gains (PFU) at 30% flat rate
- Professional Traders (BNC): Taxed as business income at progressive rates up to 45%
Most individuals fall under BIC if trading isn’t their primary income source.
- Calculate Your Gains
Use FIFO (First-In-First-Out) method:- Gain = Sale Price – (Acquisition Cost + Associated Fees)
- Track all transactions including trades, airdrops, and mining rewards
Deduct losses from gains before taxation.
- Complete Tax Forms
- Form 2086: For capital gains (BIC)
- Form 2035: For professional income (BNC)
- Form 2042 C PRO: Main income tax return (attach supplementary forms)
- Submit by Deadline
Online declaration via impots.gouv.fr by early June annually. Paper returns due mid-May.
Essential Record-Keeping Requirements
Maintain these records for 6 years:
- Transaction histories from exchanges
- Wallet addresses and private keys documentation
- Date-stamped proof of all transfers
- Calculation spreadsheets for gains/losses
- Receipts for hardware wallets or mining equipment
Critical Mistakes to Avoid
- Not declaring peer-to-peer transactions
- Forgetting to report airdrops or hard forks
- Miscalculating cost basis using wrong valuation method
- Overlooking foreign exchange accounts
- Missing loss deductions against gains
FAQ: Crypto Tax Reporting in France
Q: Do I pay tax if I haven’t sold my crypto?
A: No tax applies until disposal (selling, trading, or spending). Holding isn’t taxable.
Q: How are staking rewards taxed?
A: Rewards are taxable as income at market value when received. Subsequent sales trigger capital gains tax.
Q: What if I traded on foreign exchanges?
A: You must still declare all global transactions. France taxes residents on worldwide income.
Q: Are there any tax exemptions?
A: Occasional traders enjoy a €305 annual exemption. Professional traders can deduct business expenses.
Q: Can I use crypto tax software?
A: Yes, tools like Koinly or Accointing generate France-compliant reports using API imports.
Q: What penalties apply for late filing?
A: 10% penalty plus 0.2% monthly interest on unpaid taxes. Deliberate evasion risks criminal charges.
Staying Compliant in 2024
With France implementing DAC8 crypto reporting rules in 2026, transparency is increasing. Start organizing your transaction history now using dedicated portfolio trackers. Consult a French tax advisor specializing in crypto if handling complex cases like DeFi loans or NFT royalties. Proper declaration avoids audits and ensures you benefit from legal deductions.
