The advent of cryptocurrencies such as Bitcoin is a new and evolving area and determining their legal and regulatory status is ongoing.
Since Bitcoin, other cryptocurrencies have emerged such as Bitcoin Cash, Litecoin, Ethereum and Ripple.
Cryptocurrencies are a unique asset class and therefore cannot be directly compared to any other form of investment. Bitcoin and several other cryptocurrencies that followed are gaining real traction in the investment community. This is because they have produced astronomical returns over the last few years.
However, as more and more people are investing in cryptocurrencies, the HMRC is becoming more serious about their taxation. Cryptocurrencies are witnessing unprecedented growth, but most investors aren’t aware that every cryptocurrency transaction is taxable. Whether you are trading real money or just another cryptocurrency, all the transactions must be reported on your tax return.
Cryptocurrencies can have VAT, Corporation Tax, Income Tax and Capital Gains Tax implications, depending on the activities and the parties involved.
Taxation of cryptocurrencies can be a complex area that requires expertise, and HMRC often deals with taxing them on a case-by-case basis.
Our team have gained exposure to how cryptocurrency is traded in the real world, and we have expertise in dealing with the relevant tax implications right from its acquisition through to its use, realisation and eventual remittance. We shall endeavour to ensure that your tax exposure to any income or capital gains from cryptocurrencies is minimised.
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If you would like more information or would like to speak to us direct then call us on 020 3950 5523. Or if you would prefer, ask us a question online.