When Do You Pay Tax on Crypto in Latvia? (Only When You Cash Out)

Short answer: in Latvia, tax on crypto arises only when the crypto is converted to euro (or another fiat currency) or used to buy goods / a service. Transfers between your own wallets, holding, and — on the current VID position — a crypto-to-crypto swap on its own do not create tax.

This article answers one specific question. For the broader picture — Crypto Tax in Latvia 2026 — the full guide. Step by step on how to declare — here.

This page is not individual tax or legal advice.

Which transactions create tax

In Latvia, capital gains from crypto are taxed at the moment of disposal. Disposal (realisation) means:

• Selling for euro or another fiat currency — the classic case. Sell on an exchange for euro → a gain or loss arises.
• Using it to buy goods or a service — if you buy a car, a flat or anything else with crypto, it’s the same as selling first and then buying. A gain arises on the crypto side.
• Exchanging it for another currency or security — if crypto is used to acquire shares, fund units or another financial instrument, this is generally treated as a disposal.

Gain = disposal price minus acquisition cost minus allowable expenses.

Which transactions create no tax

On the current VID position:

• A transfer between your own wallets. ETH from a Ledger to a Trezor — not a disposal. Both wallets have one and the same owner.
• Holding. A risen market value on its own creates no tax — only at the moment of disposal.
• A crypto-to-crypto swap. Swapping ETH for SOL is not a disposal — until the crypto received is converted to euro.

Important. Not counting a crypto-to-crypto swap does not mean it doesn’t have to be recorded. The acquisition cost carries over from the original crypto to the new one — and you’ll need to show it when you sell the new crypto for euro. Without history, the acquisition cost will be €0.

Edge cases

Stablecoin conversion

USDT or USDC is a crypto-asset, not euro. A swap between BTC and USDT should be treated as a crypto-to-crypto transaction, not a fiat conversion. But selling USDT for euro is a disposal — just like any other crypto.

Paying with crypto

If you pay for a service with BTC and the BTC’s value at that moment exceeds its acquisition cost — in VID practice this transaction is treated as a disposal. Gain = the BTC’s euro value at that moment minus the acquisition cost.

Salary paid in crypto

If an employee receives remuneration in crypto, it’s treated as a typical salary-payment situation — taxable income at the moment of receipt, at its euro value that day. What happens afterwards is a separate capital-gains question.

Mining and staking rewards

The approach here isn’t uniform. For staking rewards in detail — see the full guide. For mining — depending on scale and how systematic it is — the activity may be classified as economic activity.

Airdrops and forks

Receipt itself is, on a conservative approach, income at market value. A later sale is a separate capital-gains event.

When to declare

The duty to declare arises in the quarter in which a taxable transaction occurred — regardless of whether there’s a profit for the year overall.

• If quarterly income from the disposal of capital assets exceeds €1,000, you declare for that quarter — by the 15th of the following month.
• If it doesn’t exceed €1,000 in any quarter, you declare once a year with the annual income return.

Details on filling in EDS — in a separate article: How to declare crypto income in EDS.

Why this matters now

Until now VID’s approach to crypto has been reactive — without an automatic data feed from exchanges. That changes in 2026: DAC8 comes into force, an EU directive requiring EU crypto service providers to report client transactions to the tax administration. The first report is due by 30 June 2027 for the 2026 calendar year.

In practical terms: as early as 2027 VID will see a structured dataset of what happens in crypto accounts. The risk of non-declaration — until now “practically small” — becomes concretely calculable. There’s a detailed DAC8 explainer in a separate article.

When to talk to a lawyer

• If the volume or gain is large.
• If several years haven’t been declared.
• If you’ve received a VID question or notice.
• If the transaction is non-standard — DeFi, OTC, an NFT issuance, a foreign exchange.

An overview is one thing — an individual solution is another. DONE advises both retroactively (sorting out prior years) and going forward (a structure that works this year). Get in touch. There’s more on how an engagement works on our crypto lawyer in Latvia page.

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Related articles:

• Crypto Tax in Latvia 2026 — the full guide
• How to declare crypto income in EDS — step by step

Updated: 2 June 2026.