With the recovery in cryptocurrencies now seeming to be well on the way, some investors are turning their heads to another potential problem\u2014the taxman. In Japan that\u2019s a particular issue since all cryptocurrency investments are considered as property, meaning they are liable to the taxes that property attracts. Japan\u2019s cryptocurrency traders are bracing for the oncoming Japanese tax season, which runs from February 16 until March 15. All cryptocurrency earnings in the Asian country are required to be reported as \u2018miscellaneous income,\u2019 incurring capital gains taxation of between 15% and 55% due to virtual currencies being legally classified as \u2018property.\u2019 Some traders have criticized the income brackets chosen by the National Tax Agency, with the top bracket applying to payers with an annual income of\u00a0JPY40 million yen (approximately $375,000). By contrast, the top bracket is charged only 20% for income derived from foreign exchange or stock market trading. Now if that seems fair, I really don\u2019t know what isn\u2019t. Japanese crypto investors look to alternative places to declare their taxable income The heavy taxes faced by large-scale bitcoin traders have prompted a number of Japanese cryptocurrency traders to explore relocating to jurisdictions offering more lenient taxation on earnings derived through virtual currencies. There are several upstarts in this respect and these may include EU member states such as Malta and Cyprus, while the usual tax havens in the Caribbean are always an attractive proposition. According to\u00a0Bloomberg, the chief executive of Shiodome Partners Tax Corp, Kengo Maekawa, indicated that \u201ca handful of cryptocurrency-rich investors have already left Japan.\u201d Maekawa stated that his firm has recently experienced an increase in clients in their 30s and 40s seeking tax advice on income derived from cryptocurrencies. This is in line with the average cryptocurrency investor age bracket. Some traders have also complained that certain aspects of Japan\u2019s present tax requirements regarding legacy Bitcoin, or SegWit1X (BTC), and other cryptocurrencies are unclear. Hiroyuki Komiya, the manager of a Tokyo-based distributed ledger technology consulting firm, said: \u201cThe government hasn\u2019t clarified certain details, so you\u2019re left unsure whether you\u2019ve got it right or not.\u201d Komiya stated that he was able to reduce his taxable income by \u201ca few million yen\u201d when using an \u201coverall average\u201d rather than a \u201cmoving average\u201d when conducting calculations. That could have significant impact on the tax bill so other crypto currency investors should look at this option in the short to medium term.