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Cryptoassets and tax

13 December 2021 / Andy Wood
Issue: 4821 / Categories: Comment & Analysis
Hodl me, Shill me, Kishu me

Key points

  • Cryptocurrencies and cryptoassets have their own complex tax issues and terminology and this article explains some of the main issues and terms.
  • HMRC set out some views in a 2014 briefing but this was updated and expanded in 2021 and a Cryptoassets Manual has been published.
  • Bitcoin is a cryptocurrency that made its early adopters wealthy although the UK and other major economies do not accept it is an actual currency.
  • It follows that gains and losses on crypto are not strictly treated as gains and losses on foreign currency exchange.
  • If a taxpayer’s activities are considered as investment any profits or losses on disposals will fall within the capital gains regime.
  • There are a number of ways to trigger a disposal. However this tends to lead to most non-compliance.

With apologies to Gloria Estefan for the title…


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