With more people investing in crypto currencies, we want to ensure that all individuals are aware of the tax consequences of these investments.
Due to the ever-growing popularity of crypto currencies, HMRC have released updated guidance on the taxation of these digital exchange tokens, including when and where each type of tax is liable.
The nature, frequency and level of organisation of trades is used to determine whether Income Tax or Capital Gains Tax is payable. Where tax is due, individuals will be required to register for self-assessment and complete a self-assessment tax return.
Whilst HMRC state that, in the vast majority of cases, individuals holding crypto assets will be liable to pay Capital Gains Tax on the disposal of crypto assets, there are some scenarios where individuals will be liable to Income Tax and National Insurance contributions.
As HMRC are currently actively reviewing investments into crypto currencies, ensuring that the correct amount of tax is paid, we can educate you on the UK tax implications of investing in these assets.