Position of the Belgian Ruling Commission on mixed crypto portfolios: what are the consequences?
- Aeacus Lawyers
- 2 days ago
- 4 min read
Our phone has been ringing off the hook this week. Many investors have asked us for clarification on the 2024 Annual Report of the Belgian Ruling Service (DVB). It states that as soon as an investor manages even a few coins in a speculative way, all capital gains on the entire crypto portfolio would become taxable as “miscellaneous income.” This is an extremely strict position and, in our view, legally unsustainable.
What does the Belgian Ruling Service say in its annual report about mixed crypto portfolios?
For the sake of clarity, we would like to restate (in our own translation) what the Belgian Ruling Service (DVB) has said regarding mixed crypto portfolios:
“7.1.5. Qualification of capital gains on cryptocurrencies
Case 1:
The applicant holds different types of cryptocurrencies. One particular coin is held according to a buy-and-hold strategy. He occasionally buys more of this coin, but none have been sold yet.
For his other coins, he applies a more speculative strategy, and the applicant himself considers that the gains on those coins could qualify as miscellaneous income, taxable at 33%.
The applicant asks the DVB to confirm that the gains on the coin held under the buy-and-hold strategy are exempt, while the gains on the other coins should be treated as miscellaneous income.
The DVB takes the view that, in determining the investment strategy, no distinction can be made between the different types of cryptocurrencies held by the applicant. The strategy must therefore be assessed based on the applicant’s crypto portfolio as a whole.
Since the gains on certain coins are in any event considered miscellaneous income under Article 90, first paragraph, 1° of the Belgian Income Tax Code (WIB 92), it follows that all gains realised by the applicant on his cryptocurrencies must be treated as miscellaneous income — including those realised on the coin held according to a buy-and-hold strategy.”
An unsustainable position
With this approach, the administration adopts an overly simplified view of an investor’s strategy. It wrongly assumes that an investor can pursue only one single strategy, which must be assessed across the entire crypto portfolio.
In our view, the DVB overlooks a core principle of speculative transactions: each transaction and each acquisition must be assessed separately. For a correct qualification under normal private wealth management, the question must therefore be examined per transaction, at the time of purchase, to determine whether speculation or normal management applies.
The relevant moment is the purchase
Speculation must always be assessed at the moment of acquisition, i.e. whether the investor had a speculative intent or mindset at that time. Initially, the focus was mainly on the intention to sell within a short period, and later also on the level of risk assumed by the investor. The assessment of that risk may be open to debate, but the holding period is objectively verifiable. One can determine exactly how many days a particular coin was held and whether this qualifies as short-term. In practice, this is often used as the most obvious criterion to distinguish normal private wealth management from speculation.
That said, this approach can be overly simplistic. The assessment should always be made based on the circumstances at the time of purchase, independently of the overall portfolio picture that only emerges later. Of course, if a coin is sold again only a few days after acquisition, this may retrospectively be a strong indication that there was already an intention to resell quickly at the moment of purchase.
The DVB’s position, whereby all transactions within the same taxable period are grouped together under a single qualification, is therefore difficult to understand. In our view, this approach disregards established legal doctrine and case law, which have consistently emphasised that each transaction must be assessed individually and that the investor’s intent at the time of acquisition is decisive.
This does not mean that DVB statements should be underestimated — but neither should they be overstated. Their positions have far-reaching consequences and deserve attention. At the same time, the DVB often adopts an extremely cautious approach. Particularly in the context of crypto investments, we sometimes see questionable positions being taken, such as the claim that no more than 25% of one’s movable assets may be invested in crypto in order to qualify as normal management — an entirely arbitrary threshold in our view.
It should also be stressed that when the DVB issues a ruling, the tax administration is bound by it. A ruling provides legal certainty for the applicant and obliges the tax authorities to follow that position. This creates a delicate balancing exercise for the DVB. Because their decisions are binding, they are often reluctant to recognise transactions as normal wealth management. In crypto cases, this regularly leads to strict and sometimes debatable conclusions, such as the alleged 25% limit, which in our view has no legal basis whatsoever.
Ultimately, however, it is important to underline that the DVB does not make the final determination. In practice, the initial qualification is made by the tax auditor, and any disputed decision can ultimately be brought before the courts.
Conclusion
The DVB’s position is legally highly questionable and is even regarded by many tax authors as an error or an erratum.
Investors should therefore not assume that every mixed portfolio will automatically be treated as speculative. That said, when combining different strategies, it is advisable to create a clear separation between long-term holdings and speculative transactions — for example by using separate wallets or platforms.
If you have further questions about crypto taxation, feel free to consult our Frequently Asked Questions (FAQ)
Christophe Romero Senne Verholle
