If you make a profit on crypto assets (cryptocurrency) such as Bitcoin, tax applies. At present (as of June 2026), crypto asset profits are taxed as "miscellaneous income" under aggregate taxation, with progressive tax rates applied on the total after combining them with other income such as salary (up to about 55% including residence tax). A key point to note is that this treatment differs greatly from stocks (separate taxation of about 20%). On the other hand, the FY2026 Tax Reform Outline set out a policy direction to move to separate self-assessment taxation (about 20%). This article organizes, in a neutral way, the taxation mechanism under the current rules, the timing at which profits arise, the calculation method, and the direction of future reform.
The current rule: miscellaneous income, aggregate taxation
Crypto asset profits are, in principle, classified as miscellaneous income and are subject to income tax and residence tax after being combined with salary income, business income, and the like. Because it is excess progressive taxation, where the tax rate rises as income grows, combining income tax (5–45%) and residence tax (about 10%) can reach a maximum of about 55%.
Profits on listed stocks and FX are subject to separate self-assessment taxation of about 20% (20.315%), but crypto assets are under aggregate taxation, so the higher your income, the higher the tax rate. Also, crypto asset losses cannot be offset against other income such as salary, nor carried over to the following year (under current rules).
The "timing" at which tax applies
It is often assumed that "tax applies only when you convert to Japanese yen," but profits are realized in other situations too. Tax applies in the following situations.
① When you sell crypto assets and convert them to Japanese yen
② When you buy goods or services with crypto assets (calculated at the market value at settlement)
③ When you buy (exchange for) another crypto asset using one crypto asset
④ When you acquire crypto assets through mining, staking, lending, and the like
Merely buying and holding (a state of unrealized gains) is not taxed. Income arises only at the point the profit is realized, such as through a sale, exchange, or use.
How to calculate the profit
If you bought the same crypto asset over several purchases, the acquisition cost is calculated using the total average method (the default if you have not filed a notification) or the moving average method[National Tax Agency No.1524 (in Japanese)].
This ¥2 million is added on top of other income such as salary, and is taxed at the progressive rate corresponding to the total taxable income.
A salaried person must file a tax return if their income other than salary, including crypto assets, exceeds ¥200,000 for the year (even at ¥200,000 or less, a residence tax declaration may still be required). Download and keep your transaction history from the exchange.
Future direction: policy to shift to separate self-assessment taxation (about 20%)
The FY2026 (Reiwa 8) Tax Reform Outline, published in December 2025, set out a policy direction to shift crypto assets to separate self-assessment taxation (income tax 15% + residence tax 5% = about 20%), on the premise of developing a system to protect investors. Alongside this, a direction to allow the carryover of losses for three years under certain conditions was also indicated[Ministry of Finance Outline (in Japanese)].
This is a policy direction set out in the Outline; as of now (June 2026) it has not been legislated or enforced. Separate taxation will actually apply only after the law is amended and comes into force (at the earliest, from the following year onward). Profits realized during 2026 continue to be calculated as miscellaneous income under aggregate taxation. Always check the latest enforcement status with the National Tax Agency's information.
FAQ
How much is crypto asset tax now? Is it 20% like stocks?
No. As of June 2026 it is miscellaneous income under aggregate taxation, with progressive rates on the total combined with salary and the like (up to about 55% including residence tax). This differs from the roughly 20% separate taxation on stocks. The shift to separate taxation is at the policy stage of the Tax Reform Outline.
Is there no tax if I don't convert to Japanese yen?
Even without converting, profits are realized and become taxable through purchases made with crypto assets, exchanges for another crypto asset, the acquisition of mining rewards, and the like. If you are merely holding, it is not taxed.
Do employees need to file a tax return too?
A tax return is required if your income other than salary (including crypto asset profits) exceeds ¥200,000 for the year. Even at ¥200,000 or less, a residence tax declaration may be required.
Can crypto asset losses be offset against other income?
Under current rules, crypto asset losses cannot be offset against other income such as salary, nor carried over to the following year. The reform Outline is considering the carryover of losses.
Summary
Reference links (sources)
This article is based on the following published materials (neutral, primary sources). Because the tax system is revised, please confirm the latest content before filing.
- National Tax Agency No.1524 Income calculation when carrying out transactions using crypto assets (in Japanese)
- National Tax Agency On the tax treatment of crypto assets and the like (FAQ) (in Japanese)
- Ministry of Finance FY2026 (Reiwa 8) Tax Reform Outline (in Japanese)
* This article is general information, not tax advice. For individual decisions, please confirm with a tax office or a tax accountant.