Cryptocurrency property rules change
Rules governing the purchase of property using cryptocurrencies in Portugal will become tighter and more regulated from this week.
The property news site Idealista/News reported last week that it has become increasingly popular for investors to buy properties in Portugal using cryptocurrencies because it is seen as a tax haven for crypto-businesses.
However, the Portuguese Association of Notaries has prepared a regulation that will give clear guidelines to notaries on what they have to do when investors seek to make property purchases using cryptocurrencies. The new checks will be introduced to detect money-laundering and tax evasion.
According to the newspaper Expresso, the association did not register digital businesses because when buying a house in cryptocurrencies a conversion into euros has to take place before contracts are signed.
But now, under the terms of the new regulations, investors will be able to buy properties using cryptocurrencies as if it were a barter transaction, it will be treated as a high-risk business to prevent money laundering and tax evasion.
So, how will it be done from this week? Anyone who wants to buy a property using cryptocurrencies will have to inform the estate agency or notary five days before the signing of the contract. They will have to provide data and details which the notary will send to the Portuguese criminal investigation authorities — the DCIAP.
The information must identify the parties involved, the price snd type of cryptocurrency, present proofs of purchase of cryptocurrencies (registrations of the acquisition of the virtual currencies up until the moment of purchase), send information about wallets (where the cryptocurrencies are stored) and inform the date of contract signing.
If the transaction is over €200,000, there are other rules that have to be met such as informing the tax authorities and a requirement to buy the amount of the cryptocurrencies on the date of the promissory contract and to the value of the property at the date of contract exchange.