Often, the honesty side to things springs from need. Until you really need to convert your crypto to FIAT, you can get away being under the radar (for now). It’s when one wants/needs to convert to FIAT that you need to bear in mind all the legal aspects it entails, alongside with knowing how to justify it properly in case of an inspection.

In Spain we are now in the season where we prepare our Statement of Income over 2018’s overall earnings. This year it seems, 14.700 Spanish residents are viewing a pop-up whist preparing the Statement of Income, reminding them that the benefits made from crypto operations are subject to taxation. The message is not random or a general reminder to all, but specifically to a set of residents of which the tax office has information about in relation to their crypto operations.

How the tax office knows exactly is unknown, but likely, they have targeted all bank accounts that receive FIAT transfers from known exchanges, being the Spanish banks the ones who provide this information to the tax office. One could try to go through alternatives such as Localbitcoins, but many consider it risky.