The European Court of Justice has in a recent court case decided that companies that provide services consisting of the exchange of traditional currency for the "bitcoin" virtual currency is from a VAT point of view to be treated exactly as traditional currencies. That means that purchase and sale of bitcoins with Danish kroner or any other currency is to take place without VAT.

Until now it has been uncertain in Denmark how purchase and sale of bitcoins should be treated from a VAT point of view but since the court case is applicable in Denmark as well, it is now certain that such transactions are exempt from VAT. Companies having paid VAT on such sales can ask the tax authorities for a refund of the VAT. In Denmark companies doing business with purchase and sale of bitcoins must instead pay payroll tax.

With the judgement bitcoins have - at least from a VAT point of view - been accepted as real means of payment. Whether that will have an impact on the taxable treatment of the purchase and sale of bitcoins and on the regulation for financial actors has not been decided yet.