The European Court of Justice (ECJ) ruled on October 22, 2015, that transactions to exchange a virtual currency such as bitcoin for another currency are not subject to the Value-Added Tax (VAT). Exchanges of Bitcoin for traditional currency is considered to fall within one of the currency exemptions to the VAT rules. We have issued a detailed analysis of the ECJ decision, which can be accessed here.
In the United States, in 2014, the Internal Revenue Service characterized Bitcoin and other virtual currencies as property for purposes of the application of the US federal tax rules.
Norton Rose Fulbright is publishing a global legal and regulatory guide to cryptocurrencies. The guide is being published in a series of chapters covering a range of legal and regulatory issues relating to cryptocurrencies.
You can download the first chapter and register to receive subsequent chapters here.