Defraud the Treasury in your operations

✔️ Information reviewed and updated in June 2024 by Eduardo López

One of the situations that you must take into account when trading electronic currencies is the fact that, although they are not centralized, you must report their use. Defrauding the treasury could seem like an interesting option, since you would be avoiding paying taxes, although in reality, this is not the case.

Many countries contemplate the use of these currencies within the tax laws. Here we will tell you what tax fraud is, what are the situations that can lead to this and how to solve it.

✨Situations in which you can defraud the treasury

  • Do not declare income tax

Considered the most common form of tax fraud, and the easiest to carry out, This way basically consists of not declaring the taxes on the income that you generate from your trading operations.

Although you may think that this is very easy to do, and could go unnoticed, in reality it is not. This because of banks have placed cryptocurrency operations under surveillance Therefore, any transfer is reported directly to the Treasury, which can penalize you for this action.

  • Offshore Account

Another of the most common ways to try to defraud the Treasury is to open an Offshore account, that is, abroad. This in order to send your earnings generated from your cryptocurrency platform to the account abroad, thus evading the local treasury.

In this way, let's say that the resources generated between the trading platform, your bank account and the Offshore account are triangulated. For the tax offices, this is a kind of double fault, since not only are you declaring your earnings, you are also diverting them to an unofficial Offshore account.

  • Bank cards

An undeclared bank card is another way of trying to evade the treasury, since many investors in cryptocurrencies use cards as a way to finance their lifestyle, but hiding this data. It is as if you declared that you earn minimum wage, but with your card you buy a super car.

Here, as in the previous point, you would be incurring multiple fouls. You would have a tax discrepancy by spending more than you claim to pay, then you would have an undeclared card, as well as unreported earnings from an investment activity.

  • Use someone else's account

Finally, we have a modality that is not so practiced, but that can be a way of defrauding the treasury. Basically it is about operating in another account that is not yours, with bank details and tax information that does not correspond to you.

Basically it is about identity theft, in addition to that you would not be declaring the money generated. Here we are talking about much more serious fines, since you are falling into a greater offense that is that of identity theft. It can also be more complex to perform this type of action.


✨Solution to tax fraud

While, Most of these forms of tax fraud are not illegal when you declare the income and taxes generated by this activityIn reality, there is always a risk. And it is that trying to evade taxes is a bad idea that, without a doubt, you should avoid.

Why? Because you would simply be falling into a crime which can be punished with jail or fines depending on its severity. It does not matter if you only evade $ 10 or $ 100, the fines will be much higher than what you did not declare so in the end, instead of saving, you will end up overspending.

Let's say you make a profit of $ 200 and don't report it. Then, the treasury realizes that you did not cover the corresponding tax percentage, so they place a fine. This fine is $ 2,000. So do you think it's really worth it?

That is why many experts agree that it is better to declare taxes in a timely manner when the amount of payment does not exceed the risk of being a creditor of a fine. Just think in numbers. What is cheaper? Pay a tax evasion penalty or pay your taxes?

✨The solution for large capital gains: Leave the country

When making millions in profit, say 2 million or even 20 million, one of the most common decisions is to leave the country where you reside. Why? Simple, avoid paying the taxes charged in your current country.

And there are countries where commissions are practically not charged for this type of operations and profits, while in others up to 50% taxes are charged. That is why many people tend to leave their country to start in another, but with more money.

Just think, you generated 20 million in performance and you have two options; stay in your country and pay 8 million in taxes or move to another like Thailand with a whole 20 million. What would you choose? 20 million are enough to make a life or live a season and then return to your country of origin.

Many investors who generate a large amount of profits with cryptocurrencies tend to follow this modality. Today a large number of millionaires live outside their country of origin, in other nations where there are tax exemptions or are considered a tax haven for these investors.


✨Never do tax evasion

Finally, we recommend that for more money you want to earn, never, but never, do tax evasion. This can get you in a lot of trouble, since tax evasion can lead you to defraud, a crime that is much more punishable by tax laws.

If you are starting out, do not complicate your life by making decisions that can lead to difficult situations. It is best to follow the law to the letter and comply with the requirements that they ask of you. This way you can build a solid reputation and gain experience without getting into trouble and penalties.

Eduardo Lopez

Editor and Copywriter

I am Eduardo López Martínez, I was born in Madrid, Spain and I am 48 years old. I am a journalist and I am part of the team. Do you want to know a little more about me? I invite you to read my biography.

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