Czech Republic exempts capital gains tax on crypto over 3 years

The Czech Republic has officially approved a law that exempts capital gains tax on Bitcoin (CRYPTO:BTC) holdings that are held for more than three years.  

This decision was unanimously passed by the country’s parliament on December 6, 2024, and is set to take effect on January 1, 2025.  

Under the new tax regulations, individuals can benefit from exemptions if their total gross annual income from cryptocurrency transactions does not exceed CZK 100,000, which is approximately $4,000.  

According to the news outlet Parlamentní Listy, this law provides clear guidelines regarding which cryptocurrency transactions can be excluded from personal taxation.  

"Individuals can benefit from these exemptions if their total gross annual income from cryptoasset transactions does not exceed CZK 100,000," the report noted.  

"This guarantees that if you hold cryptocurrencies for more than three years, their sale will not be taxed," Prime Minister Petr Fiala expressed on X (formerly Twitter), showing support for the new tax rule.

He further emphasised that the government aims to create better conditions for cryptocurrencies and support modern technologies.  

To qualify for the tax exemption, digital assets must not have been part of business assets for at least three years after ceasing self-employment.  

The new framework also has retroactive implications; digital assets acquired before 2025 can still qualify for exemptions if sold under the specified conditions in future tax years.  

These reforms align with the European Union’s Markets in Crypto-Assets (MiCA) framework, which will be fully implemented on December 30, 2024.  

With this legislation, the Czech Republic joins other countries like Switzerland and the UAE in providing tax incentives for long-term cryptocurrency holders.

At the time of reporting, the Bitcoin price was $100,918.