Latvia's Parliament, the Saeima, adopted personal-income-tax amendments on 15 October to bring crypto investments within its investment-account regime and allow a one-time declaration of existing holdings. Tax would arise when withdrawals exceed invested money. EU-licensed crypto service providers would offer the accounts.
The declaration covers assets held on 31 December 2026 with EU-licensed providers or in self-controlled crypto addresses. It charges 10% of their market value, which becomes the acquisition cost for later tax calculations. The 10% levy concerns declared holdings, not all future gains. Declarations run from 1 April to 31 May 2027, with one correction by 30 June and payment due 23 July.
People already facing criminal proceedings, tax audits, tax controls or administrative-offence proceedings over crypto income are excluded. The Cabinet must set provider requirements by 30 December 2026. Promulgation and commencement have not been independently verified.
How the account treatment differs
The change addresses an explicit restriction in Latvia's earlier rules. The State Revenue Service's investment-account guide, updated in June, says crypto transactions, including investments in funds that invest in crypto, are not permitted within the account regime. Its example describes an account used for both securities and crypto and says that account cannot receive investment-account status. This is the pre-reform position, rather than an instruction for using the newly approved crypto arrangements.
The same guide explains why account status matters. It calculates income when money paid out exceeds money paid in, checking each withdrawal in sequence. It warns that a taxable withdrawal can arise even if withdrawals do not exceed deposits across the year as a whole. Account statements support the annual declaration and record payments, withdrawals and relevant adjustments. A separate statement is prepared for each year even when there are no withdrawals, carrying the closing balance into the following year.
For comparison, the revenue service's May guide to crypto sales describes the ordinary capital-gains calculation as disposal proceeds minus acquisition cost, with a 25.5% rate applying from 2025. Acquisition cost can include commissions and other qualifying purchase expenses. Where the original cost cannot be established, the guide treats it as zero. The rate is applied to a gain under that calculation. This background explains why purchase records and the basis assigned to an asset matter when it is later sold.
The May guide also distinguishes a token swap from receiving money or other consideration. For a crypto-for-crypto exchange with no other payment, it identifies the income date as the later disposal for money, goods or services. Each transaction is assessed by its income date. It separately treats assets generated by the taxpayer, and crypto received for business services or goods, according to the economic nature of that income. Those distinctions prevent a single investment-tax label from describing every crypto receipt.
Separate reporting duties already cover 2026
Alongside the tax-account change, Latvia already has a timetable for collecting information under the international Crypto-Asset Reporting Framework, or CARF. The revenue service's reporting guidance identifies 1 January to 31 December 2026 as the first reporting period, with information due to the service by 30 June 2027. This is provider reporting for automatic information exchange between tax administrations, separate from an individual's voluntary declaration and tax payment.
The underlying Cabinet Regulation No. 751, adopted in December 2025, sets out the information trail. It requires reporting providers to establish users' tax residence through self-certification and check that information against their customer records. Reporting includes asset types and aggregated transaction amounts, unit totals and transaction counts. Transfers to distributed-ledger addresses not known to belong to another provider or financial institution also have reporting fields. Existing individual users must provide the relevant residence certification by 1 January 2027.
The regulation requires providers to retain evidence of their reporting and due-diligence work for five years, with a possible extension following a reasoned public-authority request. Retention cannot extend beyond 10 years after the reporting period ends. The declaration mechanism therefore sits alongside an existing system of transaction records and cross-border reporting. Dalimss News has separately covered Australia's crypto-reporting draft and India's crypto-tax rules.
