The Pokémon Trading Card Game was introduced in 1996. Although the cards were originally designed for gameplay, over time they have also become collector’s items, and first editions, holographic cards, and cards with special markings in particular can now be sold for substantial sums. In addition, there is a market for unopened booster boxes and so-called sealed products, whose value depends largely on the fact that the contents are unknown. Against this backdrop, the tax treatment of gains from the sale of Pokémon cards has become a real issue for individuals who acquire the cards with the intention of reselling them later.

Under Danish tax law, capital gains from the sale of personal property are generally tax-exempt, pursuant to Section 5(1)(a) of the State Tax Act. Exceptions apply if the sale is made as part of a business or if the asset was acquired for speculative purposes. Business activity presupposes a systematic generation of income and will rarely be relevant to a private collector. Speculation requires that the asset was acquired with the intent to resell it for a profit at the time of acquisition, and that the intent to resell was not an insignificant motive for the purchase, see, among other things, the Supreme Court’s decision in U.1986.747H. It is the intent at the time of acquisition that is decisive.

In assessing the intent to speculate, emphasis is placed on objective factors, including the nature and potential uses of the asset, expectations of an increase in value, the circumstances surrounding the purchase, the length of ownership, and the scope and nature of the transactions. With regard to cryptocurrency, the Supreme Court has held that the asset is, as a general rule, acquired for the purpose of resale, and that a gain is therefore, as a general rule, taxable. For trading cards, there is no such presumption, and the question of speculative intent is therefore determined on a case-by-case basis based on the specific circumstances.

The specific case involved a 15-year-old who had been collecting Pokémon cards since the age of 6. The collection was primarily built up through Christmas and birthday gifts, as well as money given as gifts that was spent on Pokémon cards. From around the age of 11, the inquirer participated in various trading events, and from the age of 14, he sold individual cards to acquire rarer cards for the collection. In 2024 and 2025, the petitioner had total income from the sale of cards of approximately 99,000 DKK and approximately 279,000 DKK, respectively, roughly on par with the corresponding expenses for purchasing and grading cards. On November 20, 2025, the petitioner transferred part of the collection to a limited liability company established by his father at an estimated market value of approximately 243,000 DKK.

The Tax Council confirmed that the Pokémon cards in question had not been acquired for speculative purposes and that the sale could therefore be tax-exempt under Section 5(1)(a) of the State Tax Act.

In its reasoning, the Tax Council emphasized several factors. Pokémon cards were characterized as part of a cultural phenomenon, and owning the cards is associated with a significant degree of prestige. The cards are used both as collectibles and for tactical battles, and they are suitable only to a limited extent as pure speculative investments. The Tax Council also noted the taxpayer’s young age and the fact that the collection had been accumulated gradually over nine years, which indicated an intent to collect rather than an intent to resell. Finally, the Tax Council considered it significant that, over the years, the taxpayer had regularly opened sealed products and booster boxes, which would have had a higher value if left unopened. This was regarded as concrete evidence that profit from resale had not been a significant factor in the acquisition.

The Tax Council further noted that the scope and nature of the transactions were not, in and of themselves, sufficient to consider the transfer to have taken place in the course of business.

The Tax Council's decision can be read here.

Our comments

The Tax Council’s ruling is the first of its kind and establishes a framework for the tax treatment of gains from the sale of Pokémon cards. The general principle is that Pokémon cards are not, as a rule, considered speculative assets, but rather collectibles with cultural and practical value. This differs from the practice regarding cryptocurrency, where the starting point is the opposite.

However, the assessment remains specific, and the ruling does not mean that every profit from the sale of Pokémon cards is tax-free. Several factors may, in individual cases, tip the assessment toward speculation, including a short period of ownership, loan-financed purchases, systematic resale without the collection actually growing, and, in particular, the storage of unopened sealed products and booster boxes, where an expected increase in value is a significant part of the asset’s nature. The young collector at issue in this case—who had opened his products and used the proceeds from sales to finance new purchases for the collection—falls at one extreme of the assessment spectrum applied by the Tax Council.

For a collector considering selling off a large collection, it is advisable to obtain a specific assessment of the tax implications prior to the sale. This is particularly true if the sale is to take place over a short period of time, if parts of the collection consist of unopened items, or if the collection is being transferred to a company.

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