Denmark’s Tax Agency Is Sending Tax Compliance Letters to Crypto Users

Denmark-based cryptocurrency users have begun receiving letters from the Danish tax agency, Skattestyrelsen (Skat), requesting that traders provide a full background of all their cryptocurrency transactions, sources informed Cointelegraph on Dec. 10.

In its letters, Skat specifically asked crypto users to provide information about profits and losses for fiscal years 2016 to 2018, according to FIFO (First In First Out) principles. These principles represent a method of inventory valuation assuming that all goods are sold or used in the same chronological order in which consumers purchased them.

Furthermore, the tax agency asked for the rates used for each transaction, information on the purpose of acquiring digital currencies, and documentation regarding the creation of a cryptocurrency wallet.

Disclosure of crypto exchange services used

In terms of crypto exchange services, Skat requested that crypto consumers revealed the confirmation of their trading activity in the form of a…