Mining and staking: how they are taxed

Mining and staking are two ways of obtaining tokens by participating in the operation of a blockchain: mining rewards those who make computing power available to validate transactions (proof-of-work mechanism), while staking rewards those who lock up their own tokens to help secure the network (proof-of-stake mechanism). Both produce income in tokens, and in Switzerland they must be framed for tax purposes using precise criteria. Let’s look at the points that matter.

Rewards are income

The basic principle is clear: mining and staking rewards generally constitute taxable income. Whoever receives them earns a return, and the fact that it is paid in tokens rather than francs does not change its nature. The income must be valued at the CHF equivalent at the moment the tokens vest and become available to the beneficiary. This determines both the taxable amount and the initial tax “cost” of the tokens received, which is relevant when they are later sold or converted.

The timing of taxation

A practical point often overlooked is when the income is realised. The general rule is that the return is deemed earned at the moment the beneficiary acquires availability of it — that is, when the tokens are actually credited and usable. With staking, where rewards may vest continuously or be subject to lock-up periods, the relevant moment must be established using consistent criteria and the CHF equivalent recorded at that date. Keeping orderly records of dates and values is essential: reconstructing them after the fact is complicated and hard to defend.

Private or professional activity?

The decisive distinction is between those operating within private assets and those carrying on a self-employed gainful activity:

• Mining almost always involves investment in hardware, energy consumption and an organisation of resources that bring it close to a professional activity, with consequences for taxes and social insurance. In such cases the costs (hardware, energy) become deductible under the ordinary rules.
• Staking of one’s own tokens, in passive form, tends to fall more easily within private wealth management, but the assessment depends on the scale, the organisation and the concrete arrangements.

The line is drawn on the established criteria of Swiss practice (deployment of resources, systematic approach, organisation), not on an automatic rule.

The case of the company

When mining or staking is carried out through a company, the framework follows the ordinary principles: rewards contribute to taxable profit, the tokens held form part of taxable capital and costs are deductible under the accounting rules. The valuation of positions and the documentation of on-chain income remain central. For a company that makes mining or staking a structured activity, the accounting framework should be designed from the outset.

Assets and subsequent sale

Once acquired, the tokens received form part of the taxpayer’s assets and must be declared at their value. Be careful not to confuse two distinct moments: taxation as income upon receipt and any gain or loss on the subsequent sale, which follows the rules on the qualification of the activity. These are two separate steps and must be treated as such.

And VAT?

The VAT treatment depends on the configuration of the activity and on the presence of an identifiable consideration. Many rewards typical of network operation do not constitute a taxable supply in the classic sense, but the assessment must be made on the specific case, bearing in mind the CHF 100,000 turnover threshold and the standard rate of 8.1% where the transaction is taxable.

Our role

SIH ONE supports individuals and companies in the tax framing of mining and staking: qualification of the activity, valuation of returns, accounting setup and organisation of documentation.

This content is informational and does not constitute tax advice. Every situation must be verified on the specific case.

Do you mine or stake and want to understand how to declare it correctly? Let’s analyse your tax position together. Let’s talk.