If you sold Ethereum (ETH) at a profit, swapped ETH for another crypto, or received staking rewards, the profit from those transactions is subject to income tax for people living in Japan, whether the trades were made on a domestic or an overseas exchange. Citing the National Tax Agency (NTA) FAQ 'Tax treatment of crypto assets, etc.' (revised December 2025) and its Tax Answers, this article sets out when Ethereum is taxed, from what amount a return is required, the tax rates and how to calculate the income.
In short, income arises not only when ETH is sold for yen but also when it is swapped for another crypto, used to pay for goods, or received through staking or lending. A salaried employee must file a final tax return if income other than salary, including crypto, exceeds JPY 200,000 a year, and the tax is aggregate (comprehensive) taxation, combined with other income (about 15-55% including resident tax). Simply holding ETH is not taxed.
Conclusion: three points on Ethereum tax - when it is taxed, from what amount, and at what rate
- Taxable events are: selling ETH (converting to yen or another fiat currency), swapping it for another crypto, paying for goods or services, and acquiring it through staking, lending or mining. Merely holding it, or only transferring it between exchanges, is not taxed
- The income category is, in principle, miscellaneous income (other miscellaneous income). If annual revenue exceeds JPY 3,000,000 and books and records are kept, it is in principle business income (NTA FAQ 2-2)
- A salaried employee with one employer must file a final tax return if total income other than salary and retirement income (including ETH profit) exceeds JPY 200,000 a year (Tax Answer No.1900). Even at JPY 200,000 or less, a resident tax return is required
- The rate is aggregate taxation: income tax 5-45% + resident tax 10% (+ special reconstruction income tax). The higher the profit, the higher the rate
- Acquisition cost is calculated by the total average method or the moving average method, and the total average method applies if no notification is filed (NTA A1-20). Overseas exchange trades follow the same rules, converted to Japanese yen
This article covers income tax and resident tax for an individual resident of Japan who trades and holds ETH as an investment. It does not cover corporations, trading as a business, non-residents, inheritance or gifts. The tax amount varies with total income and deductions, so please confirm your own return with a tax accountant or your local tax office.
When Ethereum is taxed: sale, swap, payment and staking rewards
| Transaction | Taxed | How income is calculated | FAQ question |
|---|---|---|---|
| Selling ETH for Japanese yen or another fiat currency | Yes | Sale price - cost basis (acquisition cost) - fees | 1-1 |
| Buying goods or services with ETH | Yes | Value of the goods (= transfer price of the ETH) - cost basis | 1-2 |
| Swapping ETH for another crypto (BTC, USDT, etc.) | Yes | Market value of the crypto received in the swap (= transfer price of the ETH) - cost basis | 1-3 |
| Receiving ETH through staking, lending or mining | Yes | Market value at the time of receipt is recorded as revenue; expenses incurred are deductible | 1-7 |
| Acquiring a new crypto through a split (hard fork) | Not at acquisition | Acquisition cost is JPY 0. Taxed when it is sold or used | 1-6 |
| Continuing to hold ETH (unrealised gain) | No | Individuals are not subject to year-end mark-to-market valuation | — |
| Sending ETH to your own wallet or another exchange | No | Ownership does not change, so it is not a transfer (ETH paid as a transfer fee is treated as a transfer) | — |
※ Source: NTA, 'Tax treatment of crypto assets, etc. (FAQ)', last revised December 2025. A swap with USDT (a stablecoin) is also taxed as an 'exchange for another crypto asset'.
A swap for another crypto is 'the same as selling'
NTA FAQ 1-3 says that when a held crypto asset A is exchanged for another crypto asset B, it is treated as 'buying crypto asset B with crypto asset A', and the income from the transfer of crypto asset A is calculated in the same way as when goods are bought (1-2). At the moment ETH is swapped for BTC or USDT, the difference between ETH's acquisition cost and its market value at the swap becomes income. If you repeat ETH/USDT trades on an overseas exchange, this means gains and losses are fixed on each trade.
Staking rewards: the market value at receipt is revenue
NTA FAQ 1-7 says that when crypto assets are acquired through mining, staking, lending and the like, the value (market value) of the acquired crypto assets at the time of acquisition is included in total revenue and the expenses incurred are included in necessary expenses. If you receive 0.1 ETH of staking rewards when 1 ETH = JPY 400,000, JPY 40,000 is the revenue at receipt. The acquisition cost of that 0.1 ETH becomes JPY 40,000, and when it is later sold, the difference between the sale price and JPY 40,000 becomes income again.
From what profit is Ethereum tax due? The JPY 200,000 rule and resident tax
| Position | Condition requiring a final tax return | Note |
|---|---|---|
| Company employee or public servant (one employer, year-end adjustment done) | Total income other than salary and retirement income (including ETH profit) exceeds JPY 200,000 a year | At JPY 200,000 or less, no income tax return is needed. A resident tax return is still required |
| People with salary over JPY 20,000,000 | A final tax return is required regardless of the amount | The JPY 200,000 rule cannot be used |
| People filing a final tax return for medical expense deduction, hometown tax donations, etc. | Include profit of JPY 200,000 or less in the return | The JPY 200,000 rule is a requirement for 'not filing' |
| People without salary (sole proprietors, students, unemployed, etc.) | When total income exceeds the sum of income deductions such as the basic deduction | The JPY 200,000 rule is a provision for salaried workers |
※ The JPY 200,000 is judged on profit (revenue - cost basis - necessary expenses such as fees). ETH sales, gains and losses on other crypto, and staking rewards are all calculated together as the same miscellaneous income.
The JPY 200,000 rule is a requirement for the income tax final tax return and does not exist for resident tax. If you do not file a final tax return, you must file a resident tax return with your municipality even if your ETH profit is JPY 200,000 or less. If you file a final tax return, a separate resident tax return is not needed.
Tax rates on Ethereum profit: aggregate taxation rate table
| Taxable income | Income tax rate | Deduction | Rate including 10% resident tax |
|---|---|---|---|
| JPY 1,000 to JPY 1,949,000 | 5% | JPY 0 | About 15% |
| JPY 1,950,000 to JPY 3,299,000 | 10% | JPY 97,500 | About 20% |
| JPY 3,300,000 to JPY 6,949,000 | 20% | JPY 427,500 | About 30% |
| JPY 6,950,000 to JPY 8,999,000 | 23% | JPY 636,000 | About 33% |
| JPY 9,000,000 to JPY 17,999,000 | 33% | JPY 1,536,000 | About 43% |
| JPY 18,000,000 to JPY 39,999,000 | 40% | JPY 2,796,000 | About 50% |
| JPY 40,000,000 or more | 45% | JPY 4,796,000 | About 55% |
※ ETH profit (miscellaneous income) is combined with other income such as salary, and the rate is determined by the resulting 'taxable income'. Income tax = taxable income x rate - deduction. Special reconstruction income tax is added on top (2.1% of the income tax amount; 1.1% for income from 1 January 2027 onward). The income-based portion of resident tax has a standard rate of 10% (prefecture 4% + municipality 6%).
Unlike profit on stocks and investment trusts (separate self-assessment taxation, a flat rate of about 20%), current ETH profit is under aggregate taxation, and the rate is determined by combining it with salary. A legal amendment (to the Financial Instruments and Exchange Act) to tax capital gains on crypto assets at 20% under separate self-assessment taxation has been enacted, but current aggregate taxation continues until the start date is set. The start date and scope are covered in a separate column.
When will separate taxation of crypto start? The 20% start date and the amended FIEA →
How to calculate Ethereum income: total average method, moving average method and an example
The cost basis of ETH sold (the acquisition cost of the ETH sold) is calculated by either the 'total average method', which averages the cost of ETH acquired during the year, or the 'moving average method', which updates the average at each acquisition. An individual who has not filed a notification of the valuation method uses the total average method (NTA A1-20). All trades on overseas exchanges are also converted to Japanese yen at the exchange rate on the trade date and calculated together with domestic exchange trades for each type of crypto asset.
| Date | Transaction | Calculation |
|---|---|---|
| March | Buys 1 ETH for JPY 300,000 | Total acquisition cost JPY 300,000 |
| June | Buys 1 ETH for JPY 360,000 | Total acquisition cost JPY 660,000; holding 2 ETH; JPY 330,000 per ETH (total average) |
| September | Sells 1 ETH for JPY 450,000 | Income = JPY 450,000 - JPY 330,000 = JPY 120,000 |
| November | Receives 0.05 ETH of staking rewards (market value 1 ETH = JPY 400,000) | Income = JPY 400,000 x 0.05 = JPY 20,000 (acquisition cost of this 0.05 ETH is JPY 20,000) |
| Annual total | Miscellaneous income JPY 120,000 + JPY 20,000 = JPY 140,000 | For a salaried employee with one employer, this is JPY 200,000 or less, so no income tax return is needed; a resident tax return is required |
※ Under the total average method, the average unit price of ETH acquired during the year (in this example, the average including the 2 ETH purchased for JPY 660,000 and the 0.05 ETH of rewards for JPY 20,000) is used strictly. The table is a simplified example of the idea; the actual calculation is done by transcribing the annual transaction report and overseas exchange trade history into the NTA's 'crypto asset calculation sheet (for the total average method)'.
In a year with a loss, it can be offset against the same miscellaneous income (such as profit on other crypto), but it cannot be offset against salary income or stock profit, and it cannot be carried forward to the next year (NTA Tax Answer No.2250 and FAQ). The calculation procedure, how to use the NTA calculation sheet and the treatment of losses are covered in more detail in separate columns.
Can crypto losses be carried forward? Rules on offsetting gains and losses →
ETH on overseas exchanges (MEXC, BingX, etc.) follows the same rules; CARF information exchange from 2026
Residents of Japan are taxed on worldwide income, so profit from buying, selling or swapping ETH on overseas exchanges such as MEXC and BingX must be reported as miscellaneous income, just as with domestic exchanges. Overseas exchanges do not issue Japan's 'annual transaction report', so you download the trade history (CSV) yourself and convert it to Japanese yen using the market value and exchange rate for each trade. Gains and losses on futures (USDT-denominated perpetual contracts) are also included in miscellaneous income by converting the change in USDT at settlement into yen.
From January 2026, under the Crypto-Asset Reporting Framework (CARF), exchanges in each country report non-residents' transaction information to tax authorities, and a system under which the NTA automatically receives it has started. How profit on overseas exchanges becomes known to the NTA, and the additional tax for failing to file, are covered in a separate column.
Will overseas-exchange crypto profit be discovered? CARF and tax audits in practice →
Simply sending ETH from a domestic exchange to an overseas exchange, or moving it to a wallet, produces no income (ETH paid as a transfer fee is a transfer). On the other hand, income is fixed at the moment ETH is swapped for USDT on an overseas exchange. 'It is not taxed because I have not converted back to yen' is incorrect.
Frequently asked questions
Q. From what amount of Ethereum (ETH) profit is a tax return required?
A. A salaried employee who receives salary from one employer and has completed year-end adjustment must file a final tax return if total income other than salary and retirement income (including ETH profit) exceeds JPY 200,000 a year (NTA Tax Answer No.1900). Even at JPY 200,000 or less, a resident tax return is required. A person without salary must file if income exceeds the total of income deductions.
Q. Is tax due just for holding Ethereum?
A. No. For individuals, the unrealised gain (price increase) on ETH held is not taxed. It is taxed when income is realised, such as on sale, swap, payment or receipt of rewards.
Q. Is tax due when Ethereum is swapped for another crypto or USDT?
A. Yes. NTA FAQ 1-3 says that when a held crypto asset is exchanged for another crypto asset, it is treated as buying the other crypto asset with it, and the income from the transfer is calculated. At the moment ETH is swapped for USDT or BTC, the difference between ETH's acquisition cost and its market value at the swap becomes income.
Q. How are Ethereum staking rewards taxed?
A. NTA FAQ 1-7 says that when crypto assets are acquired through staking, lending, mining and the like, the market value at the time of acquisition is included in total revenue and the expenses incurred become necessary expenses. When the ETH received is later sold, income is calculated again using the market value at receipt as the acquisition cost.
Q. What is the tax rate on Ethereum profit?
A. Currently it is aggregate taxation: income tax of 5-45% (NTA Tax Answer No.2260) + resident tax of 10% + special reconstruction income tax, according to taxable income combined with other income such as salary. Together this is about 15-55%. A legal amendment to tax capital gains on crypto assets at 20% under separate self-assessment taxation has been enacted, but aggregate taxation applies until it takes effect.
Q. Must profit from Ethereum traded on overseas exchanges (MEXC, BingX, etc.) also be reported?
A. Yes. Residents of Japan are taxed on worldwide income, and profit on overseas exchanges is reported as miscellaneous income just like domestic exchanges. Because no annual transaction report is issued, you download the trade history yourself and convert it to Japanese yen. From 2026, information on overseas exchanges is automatically exchanged with the NTA through CARF.
Q. Can Ethereum losses be offset against salary or stock profit?
A. No. ETH losses can be offset against the same miscellaneous income (such as profit on other crypto), but cannot be offset against salary income or capital gains on stocks, and cannot be carried forward to the next year (NTA Tax Answer No.2250).
Sources
- National Tax Agency (Japan) | Tax treatment of crypto assets, etc.: FAQ, last revised December 2025 (PDF, Japanese) →
- National Tax Agency (Japan) | Tax Answer No. 1900: Salaried employees who must file a return (current as of 1 April 2026) (Japanese) →
- National Tax Agency (Japan) | Tax Answer No. 2260: Income tax rates (current as of 1 April 2026) (Japanese) →
- National Tax Agency (Japan) | Tax Answer No. 1524: Tax treatment when a gain arises from using crypto assets (Japanese) →
- National Tax Agency | Tax Answer No. 2250 Offsetting profits and losses (law as of 1 April 2026; Japanese) →
- National Tax Agency | A1-20 Notification of the valuation method for crypto assets (income tax; total-average method applies if no notification; Japanese) →
- Ministry of Internal Affairs and Communications | Individual resident tax (10% income-based rate: 4% prefectural + 6% municipal; Japanese) →
- National Tax Agency (Japan) | Tax treatment of crypto assets (Japanese) →
- Crypto tax basics (this site, beginner guide) →
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NEXT STEP
Once you have checked ETH tax, see how to file a final tax return for overseas exchanges.
A step-by-step guide covering yen conversion of trade history, the total average and moving average methods with the NTA calculation sheet, filing on the preparation corner, and payment methods.
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