Netherlands’ Box 3 reform will tax unrealized gains on Bitcoin and other liquid assets at 36% annually from 2028, raising liquidity and volatility risks for investors.
- Netherlands will tax annual unrealized gains on Bitcoin, crypto, stocks, and bonds under the Box 3 Actual Return Tax Law starting Jan. 1, 2028.
- A 36% rate will apply to actual yearly returns, with losses carry-forward, a €1,800 tax-free allowance, and exemptions for real estate and some start-ups.
- Critics warn the regime plus DAC8-driven data sharing could force asset sales to pay tax, especially for volatile crypto portfolios.
The Netherlands will implement a comprehensive tax reform targeting unrealized capital gains on January 1, 2028, requiring investors to pay annual taxes on assets including Bitcoin (BTC), cryptocurrencies, stocks, and bonds even when they have not been sold, according to the government’s Box 3 Actual Return Tax Law.
Netherlands issues new tax rules for crypto starting 2028
The reform will tax most liquid financial assets based on actual annual value changes rather than assumed returns, with a projected tax rate of 36% of the actual return, according to the legislation. For cryptocurrencies and other liquid investments, authorities will apply a capital growth method comparing asset values at the start and end of each tax year, with any increase becoming immediately taxable regardless of whether gains have been realized through sales.
The system includes limited relief provisions. Unrealized losses may be carried forward to offset future gains, and a proposed €1,800 tax-free threshold per person would apply to total annual results, according to the framework. Real estate and certain start-up investments are excluded from annual unrealized gain taxation and will continue to be taxed only upon sale.
The reform follows multiple rulings by the Dutch Supreme Court declaring the previous Box 3 system unlawful because it taxed investors on assumed returns that often did not reflect actual performance. Government estimates indicate that postponing the reform beyond 2028 would cost the state between €2.3 billion and €2.5 billion per year in lost revenue.
Critics, including investors and lawmakers, have raised concerns about liquidity risks, noting that taxing unrealized gains could force individuals to sell portions of their portfolios to cover tax bills even when assets generate no cash flow. The concern is particularly acute for volatile assets such as cryptocurrencies, where sharp price fluctuations could create tax liabilities that require asset sales to manage.
Enforcement will be enhanced through expanded data sharing. By 2028, crypto-asset service providers must comply with the European Union’s DAC8 Directive, which mandates direct reporting of transaction and balance data to national tax authorities. In the Netherlands, this information will be transmitted directly to the Belastingdienst, the national tax authority, aligning cryptocurrency reporting with existing bank reporting standards.
The implementation would position the Netherlands among the most stringent jurisdictions globally for taxing unrealized gains, according to tax policy analysts. For cryptocurrency investors, the shift represents a fundamental change to portfolio strategy, cash management, and long-term holding considerations ahead of the 2028 effective date.
