Crypto Staking, Airdrop and DeFi Taxes in Latvia: What Is Known in 2026

Latvia’s tax authority (VID) has published explanations and a methodological guide on selling crypto-assets. But ask what happens with staking rewards, airdrops or DeFi income, and the published materials go quiet. This guide lays out honestly what is settled, what is not, and how to act in the grey zone so that your position is defensible.

One thing is clear from the start: the absence of guidance does not mean the absence of tax. It means the general principles of the law apply, and you should be ready to justify the approach you take.

This page is general information, not individual tax or legal advice. In non-standard situations, especially with material amounts, it is worth getting advice before you file. The fundamentals of Latvian crypto tax are covered in the full guide.

In short

• VID’s published materials cover selling and converting crypto: the rate, the calculation, the declaration. They say nothing directly about staking, airdrops, mining or DeFi.
• Two approaches to staking rewards exist in practice: income at market value on receipt, or an acquired asset with receipt-date value as cost basis and tax on disposal.
• Airdrops are usually received without any contribution — acquisition cost is zero, and on a sale the entire amount is taxable.
• DeFi has no dedicated tax regime — each transaction is assessed on its economic substance. This is where uncertainty is greatest.
• Records decide everything: date, quantity and euro value at receipt must be captured regardless of the approach you choose.
• From 2026 VID sees more and more — exchange reporting under DAC8 covers your incoming transactions too.

What is settled: the general principles

The starting point is known and covered in the full guide:

• crypto-assets are a capital asset for tax purposes, and disposal income is taxed at 25.5% personal income tax;
• tax arises on conversion to euro (or another fiat currency) or when paying for goods and services — under VID’s current position, a crypto-to-crypto exchange is not itself taxable;
• if quarterly proceeds from disposing of capital assets exceed €1,000, you declare quarterly; otherwise in the annual return;
• an acquisition cost you cannot document is zero — the entire sale amount then becomes taxable.

Every grey-zone situation below is assessed against this foundation.

Staking: the two approaches used in practice

VID’s published materials do not address staking rewards separately. Practice has settled into two approaches with different consequences:

(a) Income on receipt. The reward is treated as income on the day it comes under your control, at its market value in euro. This is the more conservative approach: nobody can argue income was “hidden” until a later sale. On a later disposal, the receipt-date value becomes your cost basis, and capital gains arise only on growth after receipt.

(b) Acquired asset, tax on disposal. The reward is treated as an acquired crypto-asset whose cost basis is its market value at receipt, and tax arises only when you dispose of it. This is the practically simpler route, especially when rewards arrive frequently and in small amounts.

The law does not say which is correct. Two markers from practice: the more systematic and sizeable the activity, the more seriously you should expect VID to view it as remuneration or even as economic activity with its own tax regime; for irregular, small rewards, approach (b) is common in practice. For material amounts, make the choice deliberately and document it, rather than by default.

Either way, one thing is non-negotiable: record the date, quantity and euro value of every reward at the moment of receipt. Under (a) you cannot compute the income without it; under (b), without it your cost basis is zero and the whole sale amount gets taxed later.

Airdrops: a zero cost basis

An airdrop usually arrives without any direct financial contribution. In that case the acquisition cost is zero, and when you later sell, the entire sale amount is taxable as a capital gain.

There is also a more cautious reading: receipt itself is income at market value, mirroring approach (a) for staking. That reading becomes particularly relevant where the airdrop is in substance a reward for actions performed — community activity, testing, promotional tasks. At that point it is no longer “money from the sky” but payment.

The practical conclusion is the same under both readings: record the date, the quantity and the market value at receipt. If you apply the zero-basis approach, those records prove when and what you received; if you apply the cautious one, they are the basis of the calculation.

Mining: scale determines the regime

Small-scale mining follows the same logic as above: an acquired asset, taxed on disposal. But where the activity is systematic, involves equipment investment and has a continuing character, it can be classified as economic activity, with a registration obligation but also the ability to deduct costs (electricity, hardware). The boundary is a judgment call; if mining is more than an experiment for you, make that judgment early.

DeFi: assessed on economic substance

DeFi transactions — liquidity provision, lending, yield protocols — have no dedicated tax regime in Latvia. Each transaction type is assessed on its economic substance, and this is where the uncertainty is greatest. Some markers:

• Lending rewards (interest for lending out a crypto-asset) are in substance remuneration for the use of capital, so the same two-approach logic as staking applies.
• Entering and exiting a liquidity pool is technically often a pair of exchange transactions (asset for pool share and back). Under the current position an exchange is not itself taxable, but pool mechanics differ from protocol to protocol, and generalising here is risky.
• Value lost inside a pool (impermanent loss) is not a deductible loss by itself — for tax purposes a loss arises only on disposal.

This is the area where we most firmly recommend an individual assessment before filing: transaction chains are long, and a classification error multiplies with every transaction in the chain.

NFTs, briefly

Selling an NFT for fiat follows the same capital-gains logic as any other crypto-asset disposal. If you create and systematically sell NFTs yourself, that activity can instead be assessed as economic activity — a different regime with different obligations.

Why records matter more now: VID’s field of view is widening

From 1 January 2026, EU exchanges and crypto-asset service providers report client transactions under DAC8, and that data reaches VID automatically — the first reports, covering 2026, are exchanged in 2027. If staking rewards or airdropped assets keep landing in your exchange account, VID will in time see that flow, whether or not you have declared anything. More in our DAC8 guide.

Practically, this changes the risk arithmetic: an inconsistent or undocumented approach that might once have gone unnoticed becomes more visible every year. Consistent records and a reasoned, uniform declaration practice are the simplest way to meet that transparency calmly.

How it is declared

The route depends on classification:

• capital gains (sales, zero-basis airdrops, approach (b) staking) — in the DK quarterly declaration or the annual return, depending on quarterly proceeds; step by step in our EDS guide;
• remuneration-type income (approach (a)) — in the annual income declaration under the general rules;
• economic activity (systematic mining, NFT issuance, sizeable staking operations) — with registration and the corresponding regime.

If you are unsure which category you are in, that is itself a signal the situation deserves a professional look.

When to talk to a lawyer

This is an area where the text of the law runs out before real-life situations do. We help choose and document a defensible approach to staking, airdrop and DeFi income, bring past periods in order, and prepare for what VID will see under DAC8. You can get in touch or read about how we work. Related reading: Crypto Tax in Latvia 2026, How to Declare Crypto Income in Latvia and DAC8: crypto-asset reporting.

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Updated: 20 July 2026. General information only and not individual tax or legal advice.