How to Avoid Capital Gains Tax on Cryptocurrency in the UK

 In FinTech

While not introducing many drastic changes, for many crypto lovers this was another sign of the tax body’s growing interest in the financial area. We maintain a how to avoid crypto taxes uk mixed portfolio of clients ranging from start-ups to £50M. We also provide private client and tax planning services to companies and high net worth individuals.

how to avoid paying tax on cryptocurrency uk

For example, suppose you purchase an asset for £14,000 with Bitcoins which you bought for £10,000. Unless the money made on Bitcoins (£4,000) is under your tax-free allowance of £12,300, you must pay either 10% or 20% Capital Gains Tax , depending on the level of your taxable income. You might need to pay other taxes if you receive cryptoassets.

Leveraging deductible costs

What is clear is that you must pay tax on cryptocurrency in respect of any gains that are made on cryptocurrency funded investments. If you rely on the trading allowance and the miscellaneous or trading income that you earn through cryptoassets is no more than £1,000 per tax year, you should keep records to show this is the case. This would include your transaction history, the market values of the cryptoassets in pounds sterling at the relevant dates, and relevant calculations.

how to avoid paying tax on cryptocurrency uk

From a tax perspective, crypto assets are treated like shares and will be taxed accordingly. You can offset them against your capital gains to reduce your overall tax liability, which includes using them to bring you back within your tax-free CGT allowance. Better still, if you’ve only got losses, you can carry them forward to offset against gains in future financial years, provided you register them with HMRC.

Are taxes higher in the UK or US

But, before you exhale a sigh of relief, keep in mind that just because HMRC hasn’t mentioned the cryptocurrency exchange you use doesn’t mean they haven’t contacted them. Fortunately, you won’t always pay tax on your crypto in the UK. You calculate CGT by comparing the price and which you bought the asset to the price at which you dispose of it. Subtract the value at which you bought the asset from the value at disposal, and the difference is the gain upon which you will have to calculate how much CGT you are liable for. Since the launch of the so-called “Genesis Block “of Bitcoin in January 2009, cryptocurrencies have become an accepted currency in many countries the world over, including the UK.

how to avoid paying tax on cryptocurrency uk

The reason for me to approach them when I needed an accountant was because of the way they handled my queries and dealt with me when I wasn’t even a paying client. Over the years it’s come to be a second nature for me to pass on all of mine and my friends’ concerns and questions to Ifthikar and team whether it be accountancy or mortgage related. My referrals have stuck with WIS and I intend to as well. You are not just getting an accountancy or mortgage advice, you are getting a team that stands by you.Hope they continue the good work and keep expanding. WIS Umbrella were supportive, responsive and friendly, providing ample advice and a professional service at a competitive rate for a first time contractor.

Coppercrypto Fake Crypto Trading Platform: Professional Design Dupes Victims

Akash is very helpful and he is having tremendous patience in explaining the things. I get immediate response from him any time.Thanks for your support. It’s great to be under the wing of WIS Accountancy after more than a year without proper accountant support. I’m very grateful to WIS – always quick and positive to respond and extremely helpful whether by email or on calls. I have been a client of WIS for a little over 18 months since my previous accountant closed their practice and I transferred to WIS after having a great meeting in person with Wijay.

how to avoid paying tax on cryptocurrency uk

The WIS Portal is really easy to use so it saves a lot of time. They also offer many other financial services and send out useful e-newsletters to share important news. Have been with WIS for more than 8 years now and can safely say have received the best service. They carry out their work in good time and give plenty of notice for information they need, not rushing in the last hour. I have been using WIS Accountancy for the last couple of years and have always found them very professional and reliable.

Recent Posts
Contacta con nosotros

Cumplimenta este formulario y contactaremos contigo lo antes posible!

Start typing and press Enter to search