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Where Taxpayers and Advisers Meet

Income from cryptocurrency

ikon.786
Posts: 1
Joined: Mon Aug 12, 2019 10:28 pm

Income from cryptocurrency

Postby ikon.786 » Mon Aug 12, 2019 10:31 pm

Dear Team,
I am thinking of investing in Cryptocurrency trading in small amount and hoping to get some regular returns.
I am unaware of if any taxation laws are there for it in mainland UK. People have different opinions on it.


Would look for your guidance on it.


Thanks

Saleha.

jason13
Posts: 153
Joined: Mon Mar 28, 2011 2:02 pm

Re: Income from cryptocurrency

Postby jason13 » Tue Aug 13, 2019 11:02 pm

I am thinking of investing in Cryptocurrency trading in small amount and hoping to get some regular returns. I am unaware of if any taxation laws are there for it in mainland UK. People have different opinions on it.
You may want to read this HMRC publication:

https://www.gov.uk/government/publications/tax-on-cryptoassets/cryptoassets-for-individuals

AnthonyR
Posts: 276
Joined: Wed Feb 08, 2017 2:33 pm

Re: Income from cryptocurrency

Postby AnthonyR » Tue Aug 20, 2019 10:39 am

Crypto taxation is a bit complex in the sense that there's no historic caselaw and up until December last year HMRC's guidance was just to treat it like you would treat other things.

If you are buying and selling cryptos with a view to investing and making a profit on the growth then it's likely to be a capital gains tax transaction, if you are mining or generating other income from cryptos then it is likely to be taxable under income tax rules.

The complication tends to come from the fact that in the UK all transactions need to be recorded in Sterling, while the alt coins are priced against BTC, which in turn is generally priced in USD, which often means converting your alt coin values from Alt-coin to bitcoin to USD to GBP. For every transaction in and out.

It's also worth noting that crypto to crypto is a disposal for CGT purposes and it's not just 'cashing out' that needs to be recorded.
Anthony Rogers LLB CTA TEP
Fusion Partners LLP
anthony@fusionpartners.co.uk

jason13
Posts: 153
Joined: Mon Mar 28, 2011 2:02 pm

Re: Income from cryptocurrency

Postby jason13 » Sun Aug 25, 2019 7:03 pm

while the alt coins are priced against BTC, which in turn is generally priced in USD, which often means converting your alt coin values from Alt-coin to bitcoin to USD to GBP.
That's not fully correct. Most "alt coins" are priced against GBP on exchanges that operate in the UK, like Coinbase (they have ETH-GBP trading, for example).

Although it's true that if you convert from one cryptocurrency to another that's a disposal for CGT and needs to be valued in GBP somehow.


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