How to Report Crypto Income in France: Complete 2024 Tax Guide

Understanding Crypto Taxation in France

France treats cryptocurrency as movable property rather than currency, meaning all crypto-related income is subject to taxation. Since 2019, a flat tax system applies to capital gains, while other crypto activities follow different tax rules. Proper reporting is mandatory – failure to declare can result in penalties of up to 80% of owed taxes plus interest. French residents must report worldwide crypto income, while non-residents only declare French-sourced crypto earnings.

Types of Crypto Income and Tax Treatment

Different crypto activities trigger distinct tax obligations:

1. Capital Gains: Taxed at 30% flat rate (12.8% income tax + 17.2% social contributions) when selling crypto for fiat or trading between coins
2. Mining Income: Treated as non-commercial profits (BNC) – taxed at progressive income tax rates (up to 45%) + 17.2% social contributions
3. Staking Rewards: Considered miscellaneous income – taxable upon receipt at market value
4. Airdrops & Hard Forks: Taxable as non-commercial profits when tokens are sold or exchanged
5. Crypto Payments: Treated as business income if received for goods/services

Step-by-Step Reporting Process

Follow these steps to declare crypto income correctly:

1. Calculate Gains/Income: Determine net gains using FIFO (First-In-First-Out) method. Deduct purchase costs and fees.
2. Complete Form 2086: Attach this capital gains annex to your main tax return (Form 2042). Include:
   • Acquisition dates and costs
   • Disposal dates and proceeds
   • Calculated net gains
3. Report Miscellaneous Income: Use Form 2042 C PRO for mining, staking, and airdrop income.
4. Declare Foreign Accounts: File Form 3916 if holding crypto on non-French exchanges.
5. Submit by Deadline: File paper returns by May 22nd or online by June 6th (2024 dates).

Key Exemptions and Thresholds

France offers limited crypto tax relief:

• Occasional sellers earning ≤ €305/year in gains are exempt
• No wealth tax (IFI) on crypto holdings since 2018
• Tax-free transfers between personal wallets
• Gifts to family members are exempt up to €100,000 every 15 years

Common Reporting Mistakes to Avoid

Prevent these critical errors:

• Ignoring crypto-to-crypto trades – All disposals are taxable events
• Forgetting foreign accounts – Penalties up to €1,500 per undeclared account
• Mixing personal and business transactions – Maintain separate wallets
• Poor recordkeeping – Retain transaction history for 6 years
• Missing deadlines – Late filing incurs 10% minimum penalties

FAQ: Reporting Crypto Income in France

Do I pay taxes if I haven’t cashed out to euros?

Yes. Trading crypto for other cryptocurrencies (e.g., BTC to ETH) triggers capital gains tax based on euro value at transaction time.

What if I lost money on crypto investments?

Net capital losses can be carried forward 10 years to offset future crypto gains. Losses can’t reduce other income types.

How are DeFi earnings taxed?

Liquidity mining rewards and yield farming income are taxed as non-commercial profits at progressive rates upon receipt.

Must I report NFT transactions?

Yes. NFT sales follow capital gains rules. Creation and sale of NFTs may qualify as artistic income under BNC regime.

Can I use crypto tax software?

Yes. Tools like Koinly or Accointing generate French tax reports using API-linked exchange data. Ensure they support FIFO calculations.

What records must I keep?

Maintain: 1) All transaction timestamps 2) EUR values at transaction time 3) Wallet addresses 4) Exchange statements 5) Receipts for purchases.

Are there penalties for underreporting?

Yes. Deliberate underreporting incurs 40-80% penalties plus 0.2% monthly interest. Criminal charges apply for fraud over €15,000.