The Brazilian Federal Tax Authority reported this Monday (18) a change in the declaration of cryptocurrencies to the IRPF, which reflects changes in the layout of the statement on dealings with digital assets. The change, based on RFB Normative Instruction No. 1888 of 2019, will come into effect from January 1, 2024.
The change in question concerns the way in which numerical fields must be filled in with decimals. With the update, the fields get a larger sizewhich requires the use of the comma as a decimal separator.
“When providing information, the completion of numerical fields with decimals is changed. With the new layout, these fields will be larger and a comma will be required as a separator between the whole part and the non-whole part.” — says the Tax Authorities.
According to the IRS, the change is mainly intended to enable transactions involving cryptocurrencies with very low individual value, which are often traded in large quantities and reach trillions of units.
“In view of the emergence of crypto-assets with very low individual value, whose transactions in many cases comprise trillions of units, there was a need to change the layout of the above-mentioned additional obligation, in order to facilitate both the reporting of information from taxpayers, such as its processing.”
What will change for investors?
Since more popular cryptocurrencies such as Bitcoin and Ethereum are easy to declare because they do not suffer from the problem of many decimal places, the change seems to target investors of so-called ‘shitcoins’, which are characterized by an extremely low unit value. value and is traded at the million tokens.
For example, Bitcoin is divided into smaller units called Satoshis, with each Bitcoin equal to 100,000,000 Satoshis. This allows Bitcoin to have up to 8 decimal places, making it possible to declare very small fractions of a bitcoin, such as 0.00000001 BTC.
Memecoins, on the other hand, like Shiba Inu have 18 decimal places, where investors can have fractions of the currency as small as 0.000000000000000001 SHIB, a value that is currently not possible to declare due to the limit on the number of decimal places.
According to the recipe, the need for change arose in response to the development of various cryptocurrencies with such characteristics. The adjustment of the layout will therefore facilitate the reporting of information by investors holding these types of assets.
The Tax Authorities announced that new rules will be applied to all new returns, original or corrective, submitted from January 1, 2024.
With the change, the IRS shows that it is alert to the cryptocurrency market and aware that a large number of investors are looking for low-capitalization digital currencies.
For example, in 2023, memecoins exploded in popularity, dominating about 33% of total trading volume.
Source: Live Coins
Barry Siefert is an accomplished journalist and author at The Nation View. He is known for his expertise in the field of cryptocurrency, and has written extensively on the topic. With a background in finance and economics, Barry has a deep understanding of the underlying technology and market forces that drive the crypto industry.
