Typically, the sale of cryptocurrencies is treated similar to investment capital for tax purposes in Sweden. The mining of cryptocurrencies is taxed as income from a hobby, unless done on a sufficient scale to be taxed as a commercial activity. The Swedish Tax Authority has not issued guidance specifically dealing with staked cryptocurrencies, airdrops, or hard forks. Depending on whether these forms of receipt of cryptocurrencies are considered gifts or a form of other income, they are either not taxed or taxed as other income.
Cryptocurrencies are not recognized as a financial instrument or official currency in Sweden.
Sweden taxes income from employment (tjänst), commercial activity (näringsverksamhet), and capital gains, among other things, through the Income Tax Act. For tax purposes, at the time of sale, cryptoassets are considered “other assets” as regulated in chapter 52 of the Income Tax Act, which provides that the profit made at the time of sale should be taxed, similarly to capital gains. Mining of cryptocurrencies qualifies as income from a hobby unless done on a commercial scale.
The Supreme Administrative Court (Högsta förvaltningsdomstolen) has established that any profits made when selling Bitcoins is subject to taxation as capital gains. Thus, the sale of cryptocurrency is subject to the capital gains provision in the Income Tax Act.
II. Tax Treatment of Block Rewards
A. Tax Treatment of Mined and Staked Cryptocurrencies
The Swedish Tax Authority has issued guidelines on the taxation of cryptocurrency mining. In accordance with the guidelines, mined cryptoassets on a personal scale are considered income from a hobby and subject to income tax based on the current market value at the time they are mined as personal income from employment (tjänst). Large-scale mining may be considered commercial activity, and is taxed as such (inkomst av näringsverksamhet). Commercial activity is defined as “activity that is conducted professionally and independently.” The Swedish Tax Authority has further determined that to assess whether the activity is professional and independent, the activity must qualify as “activity that is distinguishable as being conducted enduringly, independently, and in order to make a profit.” To qualify as commercial the activity must meet all three conditions. Hobby activities that are carried out for profit for a longer period of time are typically considered commercial activity. The Swedish Tax Authority specifically considers the following circumstances, among others, when determining if the mining of cryptocurrencies is a hobby or a commercial activity:
- That the activity is undertaken in a regular, professional, and cost efficient manner during a longer period of time with expedient equipment.
- That the activity can be expected to generate a surplus as determined across the entire financial calculation period.
- That the equipment’s calculation capacity can be expected to generate more than 25 bitcoins annually (or an equitable amount in the form of transaction fees or other virtual currency).
Staked cryptocurrencies are not directly addressed by the guidelines. It appears the Swedish Tax Authority has not made any other statements related to staked cryptocurrencies. Service providers that advertise tax services in relation to cryptocurrencies appear to treat staked currencies similarly to mining for tax purposes. However, another interpretation by one tax service provider describes the tax treatment of staking rewards as follows: “Staking is in the world of crypto the same as lending your cryptoasset and according to the Swedish Tax Authority these shall be taxed as sales during the loan and as purchases when you yourself borrow or receive back the previous lent crypto.” This interpretation would result in a different tax situation than if treated as mined cryptocurrencies. If considered mined cryptocurrencies the staked cryptocurrency would be taxable as income (either personal income or commercial activity depending on the scale) at the time of receipt, whereas if similar to a purchase, the receipt would not be taxable.
B. Tax Treatment of Tokens Received Through “Airdrops” and “Hard Forks”
The Swedish Tax Authority has not issued guidelines that specifically address airdrops or hard forks. The tax status of assets obtained by these means will depend on what form of income they are considered similar to. If the airdrop or hard fork, by its nature, is similar to mining, the receipt via airdrop or hard fork would be considered income from a hobby (or commercial activity if done on a larger scale) and subject to the corresponding tax. If they are instead considered gifts the cryptocurrency will be not be taxed at acquisition, as gifts are not subject to tax in Sweden.
Swedish tax service providers specializing in taxes related to cryptocurrency appear to take differing views of these kinds of assets. For example, the tax provider Monotax provides the following guidance on its website:
How is the tax for mining, staking, air drops, and forks calculated?
In accordance with the same rules that apply to other income. You must declare the market value of these crytpocurrencies at the time of receipt, how many you received, and when you received them. Is it a regular income to the extent that it is your main pursuit you may also have to pay employment payroll taxes.
Thus, Monotax equates staking, airdrops, and forks with mining, which is subject to income tax as described in part II(A) above.
Other Swedish crypto tax commentators have explained that airdrops and hard forks should be considered gifts: ”Airdrops or Hard Forks are considered gifts from the block chain owner and are most often a PR trick. You do not pay any tax on the gift and it is not until you sell [the cryptosasset] that you pay tax on the profit. The cost basis is zero.”
Thus, the determination of whether the receipt of cryptocurrencies through either airdrops or forks is a taxable event would likely depend on how often and why the taxpayer receives them, and if the taxpayer did any work for them. For example, a person whose activities qualify as commercial activity appears unlikely to have his or her receipts of cryptocurrencies considered gifts, because the Swedish Tax Authority would likely view the receipt as an event directly linked to the commercial activity, and not as an entirely separate event.
If considered a gift, a person receiving an airdropped cryptocurrency or a forked cryptoasset will not have to pay any tax on it upon receipt. However, when it is sold or used, the owner must pay capital gains tax on the “profit” made from the sale. Thus, at time of sale an airdropped asset or hard fork would generate a 30% tax on the profit. To the extent airdrops and hard forks would be considered gifts, the cost basis for the assets would be zero, and the entire amount the asset is sold for would be taxable. For example, a cryptoasset received when the fair market price is US$100 and sold for US$60 would be taxable at 30% of $60; even though the value of the asset has decreased, the transaction would not qualify as a loss for tax purposes, as the cost basis for the asset is zero.
Prepared by Elin Hofverberg
Foreign Legal Specialist
 Press Release, Sveriges Riksbank, Bitcoin är inte pengar [Bitcoins Are Not Money] (Mar. 14, 2018), https://perma.cc/B6VM-Y7CR. For more on regulation of cryptoassets in general in Sweden see Elin Hofverberg, Regulatory Approaches to Cryptoassets: Sweden, Law Library of Congress (Apr. 2019), https://perma.cc/FJR4-PBGF.
 52 kap. 1 § Inkomstskattelagen.
 52 kap. 3 § Inkomstskattelagen.
 Skatteverket, supra note 5.
 Kryptovalutor, supra note 3.
 Id.; 10 kap. 1 § Inkomstskattelagen.
 Skatteverket, supra note 10.
 13 kap. 1 § Inkomstskattelagen.
 Id. See also Skatteverket, supra note 10.
 Skatteverket, supra note 10 (translation by author).
 Inkomstskattelagen, e contrario, a purchase is not a taxable event see 11 kap., 14 kap., 42. kap., and 52 kap. Inkomstskattelagen.
 See Part II (A) above.
 Monetax, supra note 18 (translation by author).
 Koinly, supra note 19. See also Pontus Schenkel, supra note 22.
 Koinlly, supra note 19.
 See Part II (A) above, describing how duration, independence, and profit influence whether an activity qualifies as commercial activity. See also Inkomst av näringsverksamhet, supra note 14.
 8 kap. 2 § Inkomstskattelagen. See also Pontus Schenkel, supra note 22.
 52 kap. 1 § Inkomstskattelagen. See also Skatteverket, supra note 10.
 52 kap. 13-14 §§ Inkomstskattelagen.
Last Updated: 02/05/2021