Crypto taxes in Lithuania: when are crypto profits taxable?

The taxation of crypto held by individuals and businesses is one of the most discussed topics in recent years. When we speak about taxes in Lithuania, we refer to those collected by the State Tax Inspectorate (VMI) under laws adopted by the Parliament. In this context, the key question is: when should income related to virtual currencies be declared and taxed? How does VMI treat different situations – when crypto taxes in Lithuania apply to legal entities, to individuals carrying out individual activities, and to those making one-off transactions? This overview briefly walks through the main rules.

Why crypto profits are no longer “something new”?

If you earn income from any kind of virtual currency, crypto taxes should not come as a surprise. For some time now, the tax treatment of virtual currencies has been widely discussed. While in the past crypto may have seemed like a niche phenomenon, today Lithuania is seeing a fast-growing ecosystem of businesses built on crypto assets.

In many ways, debates about crypto taxation and declaration obligations have recently been overshadowed by another topic – the upcoming application of the MiCA Regulation and the licensing of persons engaged in virtual asset activities. Nevertheless, tax obligations have not disappeared, and both companies and individuals should pay close attention to them.

MiCA and licensing: why regulation matters for taxation

Under MiCA, certain activities related to crypto will have to be licensed, both for legal entities and for individuals who provide services on a professional basis. For businesses, operating in a way that does not comply with MiCA/MiCAR may become very costly.

The Regulation provides that only entities licensed in the EU will be allowed to provide crypto-asset services. These licensed entities will have to comply with MiCAR requirements. The specific obligations depend on the type of crypto-asset services provided, as well as the business model and operational specifics.

MiCA, which is reshaping the crypto market and crypto businesses, encourages even more attention to the regulation of virtual assets, transparency, and safety of this still relatively young and dynamic market, for all of its participants. From a cryptocurrency taxation and compliance perspective, this means that the days of operating “under the radar” are essentially over. You can read more about crypto regulations in the EU here.

Corporate crypto income: what taxes apply to businesses?

Every legal entity dealing with crypto should carefully assess which taxes and which rates apply to its specific activities. However, it is crucial to understand that legal entities holding or using virtual currencies are, in principle, subject to the same types of taxes as traditional businesses. Whether the company works with a well-known or niche cryptocurrency does not change the fact that taxes apply to businesses built on crypto assets.

For companies, the main taxes are:

Corporate Income Tax (CIT)

The corporate income tax rules for crypto activities are as follows:

• Rate: the standard rate is 16%; small companies may qualify for a reduced 6% rate (17% and 7% respectively as of 01 January 2026).
• Scope: applies to profits generated from crypto trading, “mining,” and other related activities.

Although law does not use the term capital gains tax in Lithuania, in practice, profits from the disposal of crypto assets can form part of the taxable base in a way that is functionally similar to a capital gains tax in Lithuania at the corporate level.

Value Added Tax (VAT)

The VAT rules relevant to crypto activities are as follows:

• Rate: the standard rate is 21%.
• Scope: generally applies to goods and services. The conversion of cryptocurrencies (i.e., exchanging them into fiat) is treated as VAT-exempt under EU law.

For businesses dealing with virtual currencies, declaring income from crypto is an annual obligation. Like other legal entities, these companies must submit their annual corporate income tax returns for the previous calendar year by June 15 each year.

Given the dynamic environment and the constantly evolving regulations of a relatively young market, crypto businesses often find it difficult to navigate the rules. It is, therefore, natural that many turn to tax law experts, such as the “Motieka & Audzevičius” team, who understand how cryptocurrency taxation and income/profit taxation work in the crypto context.

How does VMI tax individual crypto holders?

General filing obligations for individuals

Lithuanian tax residents must submit an annual personal income tax (PIT) return to the tax administrator by the 1st of May of the year following the tax year and pay the tax calculated in that return. This return should also include income related to virtual currencies.

According to VMI, income from crypto is included within the scope of PIT and taxed when a taxpayer carries out the following types of transactions (all of which are treated as disposal of crypto assets):

• exchanging cryptocurrencies into euros or another official currency (e.g., USD);
• exchanging one cryptocurrency for another (i.e., one crypto is treated as sold and the other as purchased);
• using cryptocurrency to pay for goods and/or services.

These transactions may trigger VAT implications depending on their nature and the specific circumstances.

What is considered taxable income?

Depending on the transaction type, taxable income is determined as follows:

• When crypto is exchanged into euros, the total amount of money received in euros;
• When goods or services are paid for in crypto, the fair market value of the goods and/or services received;
• When one crypto is exchanged for another, the fair market value (in euros) of the crypto received at the time of the exchange.

An important point: legislation does not define a single mandatory exchange rate between a given cryptocurrency and the euro. The taxpayer must determine the rate themselves, using available information and comparable market data.

Taxpayers often ask whether VMI applies different rules depending on the specific virtual currency. The answer is that, as a rule, the same crypto taxation principles apply regardless of how well-known or valuable a particular token is (as long as the income amount meets the general thresholds). However, whether a specific asset is treated as cryptocurrency, virtual currency, voucher, token, or something else depends on its features and how it is used. That classification may affect cryptocurrency taxation in practice.

Individual activity vs one-off transactions: how the source of income changes the rules

Crypto taxes in Lithuania depend heavily on the nature of the activity that generates the income. Tax treatment differs when crypto is linked to:

• registered individual activity;
• isolated, one-off transactions that do not amount to individual activity.

When completing the annual tax return for VMI, income from crypto may be declared as:

• income from individual activity;
• income from the sale or other transfer of other assets.

Regardless of the chosen category, the declaration of any income generated from virtual currencies is mandatory. Below are the two main scenarios.

1. Crypto as individual activity (self-employment)

Income is considered to arise from individual activity when all the criteria for such activity are met: independence, continuity, and the objective of obtaining economic benefit. Income from crypto transactions must be taxed as individual activity income only when the transactions meet all these conditions.

In practice, declaring crypto income as an individual activity is often relevant when a person:

• engages in continuous purchase–sale of virtual currencies;
• sells self-generated (“mined”) virtual currency regularly.

If crypto trading is carried out continuously, it is usually necessary to obtain an individual activity certificate. “Continuous” means not a single, isolated transaction but recurring, systematic trading over time. At the same time, even a large number of transactions may not qualify as individual activity if the virtual currency was not acquired by purchase but, for example, was received as remuneration for services.

Tax rate and base

When crypto dealings qualify as individual activity, the taxable profit is subject to a 15 % PIT rate (with possible progression in some cases). PIT rates become progressive after 01 January 2026, with 20/25/32% rates applicable to the aggregate amount of most types of a person’s income, including income from individual activity. The taxable income can be reduced by allowable deductions. These can be:

• Actual expenses substantiated by documents;
• A flat 30 % deduction from income without supporting expense documentation.

In addition to PIT, social security contributions may also apply and should not be overlooked.

In economic terms, these rules often operate similarly to a capital gains tax in Lithuania on business-like crypto activity, even though the formal tax is personal income tax.

2. Crypto as “other asset” – capital gains on one-off transactions

The second scenario applies when income from virtual currencies is obtained without carrying out individual activity – typically via a one-off transaction (purchase, sale, or self-generation and subsequent sale).

For example, if a taxpayer sells or otherwise realises virtual currency that they have mined, the income received upon sale/realisation is taxed as income from the sale of other assets.

In this case, the taxable base is the difference between the sale price and the acquisition price. The applicable PIT rates are:

• 15 % PIT where taxable income does not exceed 120 average monthly salaries (VDU);
• 20 % PIT where taxable income exceeds 120 VDU.

This is functionally close to a capital gains tax system applied to crypto profits at the individual level. However, there is an important exemption. PIT on crypto income is not payable where, in a given tax year, the difference between:

• Income from the sale of non-registrable assets not linked to individual activity (such as household items, works of art, crypto assets, etc.) and
• The acquisition price and related selling or production costs of those assets do not exceed EUR 2,500.

If this threshold is not exceeded, the income is not taxed and does not need to be declared. If it is exceeded, only the portion of the gain above EUR 2,500 is taxable at the 15–20 % PIT rate. As of 01 January 2026, that type of income will also be subject to the same abovementioned progressive PIT rates. In practice, this means that for many smaller investors, crypto taxes in Lithuania may only arise when their annual net gains cross this threshold.

Do you have to declare crypto you just hold?

The possession of crypto assets by itself does not require any tax disclosure when someone holds their assets without selling them.

However, it is important to retain all acquisition documents and records (purchase confirmations, mining records, transaction histories). They may be needed in the future when the crypto is sold or otherwise realised, and income needs to be declared under Lithuanian cryptocurrency taxation rules.

Need clarification on your crypto tax position?

Lithuanian rules on crypto taxes, MiCA licensing, and related regulatory frameworks are still developing, and the market itself is evolving rapidly. Suppose you did not find answers to your specific questions here. In that case, it is advisable to consult directly with a professional team – for example, specialists from Motieka & Audzevičius with expertise in crypto regulation and crypto taxes in Lithuania. This will help you structure your activities properly, manage risks, and ensure compliance with Lithuanian crypto taxation rules.