Topic: Warning UK Traders Using Bitmex/Okex/Deribit - Tax Issue (Read 178 times)
I don't think that there are official news about this one as there are contradicting statements about HMRC when it comes to taxes in cryptocurrency. Just for example HMRC said in the article I provided that cryptocurrency gains are subject to capital gains tax. So I think there is no formal and final announcement as of the moment. And the "other income" taxing method you are referring to is too much of a tax burden for the citizen trading there cryptocurrency, and I doubt they will agree to something unethical like that.
Others traditional traders pay their taxes as well, why when it's about trading cryptocurrencies people shouldn't pay it. Everybody needs to be at the same level, otherwise, some will claim they should pay taxed differently since they trade a primary commodity and not currencies.
Traders do also have capital gains loss, that's part of the deal when you trade.
How people are taxed is another question, but it really shows the incoherence from the states when it's about taxing cryptos or just how to consider it (currency, asset,...)
Traders do also have capital gains loss, that's part of the deal when you trade.
How people are taxed is another question, but it really shows the incoherence from the states when it's about taxing cryptos or just how to consider it (currency, asset,...)
What if the UK traders in their transactions accept international payments like Paypal or Payoneer? The bill will still be much larger than 50%? Also, give us your source link please
Have some seriously shit news in regards to using any of the crypto derivative platforms from the UK.
The HMRC have specific guidelines that state what can be described as capital gains & income. Spot trading can be regarded as capital gains tax, however derivative trading on non-FCA regulated exchanges falls under "Other Income". What this means is if you are hedging your stack on Bitmex / Okex / Deribit you are incurring an income tax bill at the time of the disposal (closing of trade) at the the going Sterling rate.
Essentially as the price falls you are racking up a massive tax bill. It gets worse though because you are acquiring BTC at the same time. As the market has dropped you are receiving an unrealised capital gains loss.
What this means is that you are being taxed massive on income once you realise the sale of BTC you incur a capital gains loss. The two would match up, however from a tax perspective there is no sideways relief from capital gains. It gets rolled forward to the following year!
This could mean for a lot of traders the bill is much larger than 50%. I am trying to work out how to reduce it this year, but last year seems locked in.
Anyone trading beware as the HMRC is going to want more of your hard earned money from this unfair clause. If anyone has a solution on how to reduce the bill please let me know.
The HMRC have specific guidelines that state what can be described as capital gains & income. Spot trading can be regarded as capital gains tax, however derivative trading on non-FCA regulated exchanges falls under "Other Income". What this means is if you are hedging your stack on Bitmex / Okex / Deribit you are incurring an income tax bill at the time of the disposal (closing of trade) at the the going Sterling rate.
Essentially as the price falls you are racking up a massive tax bill. It gets worse though because you are acquiring BTC at the same time. As the market has dropped you are receiving an unrealised capital gains loss.
What this means is that you are being taxed massive on income once you realise the sale of BTC you incur a capital gains loss. The two would match up, however from a tax perspective there is no sideways relief from capital gains. It gets rolled forward to the following year!
This could mean for a lot of traders the bill is much larger than 50%. I am trying to work out how to reduce it this year, but last year seems locked in.
Anyone trading beware as the HMRC is going to want more of your hard earned money from this unfair clause. If anyone has a solution on how to reduce the bill please let me know.
Jump to: