Tax and accounting consulting Play to Earn Games

Have you earned cryptocurrency or NFTs from play to earn games?

Play-to-Earn

Have you exchanged the cryptocurrencies you have earned for others?
Have you sold the NFTs you have earned through play-to-earn on OpenSea or other marketplaces and obtained other cryptocurrencies?
Do you know the tax implications of all these procedures?
Do you know that if you are the creator of the game you must withhold for awarding prizes in certain circumstances?

Play-to-Earn Games

Play-to-Earn is a business model on the basis of which players can earn money in the form of cryptocurrencies, tokens and NFTs by participating in battles and winning duels.

The objective pursued by the users is to win the games to obtain their prize or reward, which could be assimilated to on-line poker on which we have consultations from the Tax Agency that indicate that as sporadic users it should be taxed as a capital gain without transmission with Imputation in the General Taxable Base of the Income.

On the other hand, those players who make a considerable intervention and dedication in the game with a view to obtaining returns over time, must classify this income as an Economic Activity, with Imputation in the General Income Tax Base.

As you can see both incomes go to the same Income Tax Base and therefore are taxed similarly, however the obligations differ greatly in each of the cases, since if we qualify it as an Economic Activity because we can consider ourselves “gamers” professionally, we must register as Self-Employed in the Social Security, register the activity in the Treasury, submit our corresponding taxes, as well as we are obliged to keep the accounts according to the Commercial Code, among others.

If this is your case, don’t worry about all the bureaucracy, you dedicate yourself to play and win battles, we will make sure you fulfill your obligations.

Obviously, if you are a company that creates Play-to-Earn Games, you already know that you will have to pay taxes as an Economic Activity, either in income or through the Corporate Tax, but it is likely that you do not know many other implications of your operation, such as that the prizes you give out may be subject to withholding in certain circumstances, or how the Utility Tokens you give out for free should be qualified in your accounting, among many other situations.

We have experience as cryptocurrency and blockchain advisors for companies, so you can ask us your questions and we will be happy to share our knowledge with you.