Latvia plans a one-time 10% crypto tax declaration window in 2027

Latvia wants its residents to come clean about their crypto, and it is offering a discount to do it.

On October 15, 2026, the Saeima, Latvia’s parliament, adopted urgent amendments to the Law ‘On Personal Income Tax’. The changes overhaul how the country taxes crypto-assets and set up a one-time declaration window in 2027.

The headline feature is a flat 10% tax on declared holdings.

How the declaration window works

Individuals get a single chance to declare crypto assets they hold as of December 31, 2026. The 10% rate applies to the market value of those assets at that point.

The scheme covers two kinds of storage. Assets held in accounts with EU-licensed Crypto Asset Service Providers, known as CASPs, qualify. So do coins sitting in self-custodied addresses.

The timeline is tight but clearly defined:

• Declaration period: April 1 to May 31, 2027
• Amendment deadline: one correction allowed until June 30, 2027
• Payment deadline: July 23, 2027, paid into the unified tax account

There is also a notable exclusion. People already facing proceedings over tax issues tied to crypto income cannot use the new provisions.

An investment account for crypto

The second major change targets how crypto gets taxed going forward. The amendments permit an investment-account model for crypto-assets.

Under this structure, tax kicks in only when withdrawals from the account exceed the amounts originally invested. Individual trades inside the account are not taxed one by one.

These accounts will be available through EU-licensed crypto-asset service providers operating under the Markets in Crypto-Assets regulation, better known as MiCA. MiCA is the European Union’s framework for licensing and supervising crypto firms.

Background: DAC8 and Latvia’s push for crypto firms

The changes line up with the EU’s DAC8 directive. DAC8 is designed for automatic exchange of information between tax authorities, aiming to improve transparency and compliance in crypto.

The new framework also follows earlier efforts by Latvia to court foreign crypto businesses. The country waived a 3% levy for non-residents for the period from 2025 to 2027.

The legislation is not fully operational yet. The Cabinet of Ministers is expected to issue supporting regulations by December 30, 2026, to make implementation work.

What this means for holders and crypto firms

For Latvian residents with undeclared crypto, the math is relatively simple. A flat 10% on market value as of a fixed date offers certainty.

The trade-off is that the rate applies to current market value, not historical cost. Someone who bought early and sat on large unrealized gains may find 10% of today’s value attractive. Someone who bought near a peak may weigh it differently.

The snapshot date also adds a timing element. Market value on December 31, 2026, sets the base, so price swings before year-end will directly shape what declarants owe.

For crypto firms, the MiCA link is the bigger story. The investment-account model can only be offered by EU-licensed providers.

Key dates to track include December 30, 2026, for the Cabinet regulations, the April 1 opening of declarations, and the July 23, 2027, payment deadline.