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Understanding the risks of an unspoken crypto account
Wondering what is going on if you have an crypto account not declared abroad and what are the possible sanctions? In France, the law is very clear: as soon as you have cryptocurrencies on a foreign platform , you are subject to strict tax obligations. If you do not respect these formalities, the consequences can range from a simple fine to a heavier legal proceedings The objective of this article is to help you see more clearly and, above all, to avoid errors that could cost you dearly.
Table of contents
Unconceived crypto account: Why should we declare a crypto account in France?
Having digital assets via an exchange platform outside the French territory is not illegal. However, French taxation requires a number of legal obligations to ensure the compliance of your transactions with the law in force.
An obligation from the first euro
In France, the obligation to declare any Crypto account held abroad is stipulated in article 1649 bis C of the general tax code . This declaration does not depend on a minimum threshold of funds: if you use virtual exchanges based in another country-whether you deposit 10 euros or 100,000 euros there-you are required to inform the existence of this account via the 3916-Bis form .
The logic is simple: the tax administration wishes to avoid tax evasion and ensure that any taxpayer liable for income tax or the tax on crypto-actives does not bypass its duties by placing funds on platforms outside the national territory.
All Crypto accounts open to exchange, conservation or management of digital assets are concerned are concerned. This includes in particular:
- Centralized platforms like OKX , Kraken , Coinbase , Bitvavo, etc.
- Custodial portfolios managed by a foreign third party.
- Purchases via non -custodial portfolios (metamask, exodus) when using providers like MoonPay, Transak or Simplex.
- DAPPs or services DEFI DeFi dApp an intermediary in the exchange or guard of funds.
The cold wallet S ( Ledger , Tangem, Trezor ) do not require a declaration if they are used independently, without a foreign third party. But as soon as a foreign intermediary intervenes in the purchase, sale or custody of your cryptos, the declaration becomes compulsory.
Special cases and exceptions
There are specific situations where the declaration can be more complex. For example, if you very occasionally carry out transactions on a foreign exchange without keeping funds, you might ask yourself whether to declare this account. In principle, if you open an account and it is still active (even with zero euro balance), the declaration process should be carried out.
The risks and sanctions incurred for an undeclared crypto account
Not declaring your crypto account abroad is considered a breach of legal obligations . Here are the main consequences:
Financial penalties
If the tax administration discovers an unsuccessful crypto account , you risk a fine that may vary depending on the amount held and the duration of the declaration of declaration. According to article 1736 IV of the General Tax Code , the basic sanction can range from 750 euros per unaccompanied account to 1,500 euros when the account balance exceeds 50,000 euros.
In some cases, penalty fees may be added, in particular if the administration notes assimilable behavior to tax fraud or a tax evasion . Penalties can then climb quickly, without forgetting that the French authorities have implemented international agreements to exchange bank information with many countries.
Tax increase and tax recovery
In addition to the fine , you risk a recovery in your income tax or your capital gains if you have not properly declared your cryptocurrency . Indeed, if you have made profits via transactions for the sale or exchange of crypto-active without reporting them, the administration may decide to re-qualify these income and apply a tax rate .
You should know that France generally considers gains from speculation on digital assets as capital gains on securities (imposed at the flat rate of 30 % called flat tax), or as industrial and commercial profits (BIC) if the activity is considered as usual.
Risks according to the country of origin of the account
Not all courts cooperate in the same way with France. Thus, if your foreign platform is located in a country which has concluded a tax exchange agreement with France (most European countries, but also certain countries in Asia and America), the discovery of an unspoken crypto account can be done more easily thanks to automatic data exchange.
On the other hand, if your cryptocurrencies are hosted in a non -cooperative state, you can be subject to a higher level of control by the French authorities, which are very suspicious with regard to the accounts opened in these areas. The sanctions can then be reinforced, because the tax administration has a Tedencing to consider this type of assembly as an additional indicator of tax fraud .
Unconceived crypto account: when and how to declare your crypto account abroad?
Calendar and form 3916-Bis
The declaration is made when completing your tax return . Concretely, you must enter the 3916-BIS form for each Crypto account held. This annex to your income declaration allows you to indicate:
- The identity of the exchange platform digital portfolio service .
- The country of establishment and, if possible, the exact address of the company.
- The opening date and, if necessary, closing the account.
- Average or final sales depending on the information available.
Steps to be observed for the declaration
Here are the main steps to properly declare your crypto account :
- Identify all your accounts open or used abroad, even if they no longer serve.
- Download or fill out online the 3916-Bis form from the official tax administration website.
- Find out each foreign platform where you have digital assets .
- Keep supporting documents: statements, screenshots, addresses of your digital wallets , etc.
- Take up the declaration at the same time as your income tax return.
How to regularize an unspoken crypto account?
If you are late or have failed to declare a crypto account regularization solutions exist. The important thing is to act quickly to limit the risks of tax control and penalties.
First step: contact with the tax administration
The easiest way to regularize your situation is to spontaneously contact your tax center. You can then:
- Explain the reasons for forgetting or neglect.
- Provide supporting documents proving the existence and nature of your transactions .
- Discuss a possible payment schedule to pay the fines or increases due.
This proactive approach can play in your favor and reduce the severity of sanctions, because the tax administration values the cooperation of investors .
Second step: compliance
To be completely in good standing, you must:
- Complete or correct your old income declarations, by reinstating any capital gains on your cryptocurrencies .
- Place the forms 3916-BIS missing for each year concerned.
- Pay the sums claimed, including the principal of the tax, the interest in delay and the possible increases.
In some cases, you will also have to justify the origin of your funds if the tax administration suspects a larger tax fraud
Conclusion on an unspoken crypto account
Holding an unsuccessful crypto account exposes any French taxpayer to tax risks : fine , recovery, even legal proceedings and accusations of tax fraud . France, as many countries, strengthens its control systems to combat tax evasion , which increases the probability of detecting crypto accounts abroad.
To avoid sanctions, it is essential to comply with legal obligations : declare each crypto account in your income declaration, fill out the 3916-Bis form and precisely postpone your capital gains linked to the sale or exchange of cryptocurrencies . If you have already failed to declare one or more accounts, know that regularization remains the best solution to limit the extent of the penalties.
It is therefore better to adopt a proactive and transparent approach. If in doubt, consult a tax lawyer specializing in cryptocurrencies.
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Yohan Uzzan
Training engineer, I quickly became interested in the field of finance. Convinced that decentralized finance has a bright future ahead of it, I participate in its democratization by developing Crypternon.
