The increasing activity and value of cryptocurrencies means investors are now making significant profits, which in turn means HMRCHer Majesty's Revenue and Customs (HM Revenue and Customs or HMRC) is a non-ministerial department of the UK Government responsible for the collection of taxes, the payment of some forms of state support and the administration of other regulatory regimes including the national minimum wage.... More are now focused on ensuring those profits are properly disclosed and taxed.

It is therefore important that personal and corporate investors in cryptocurrency properly disclose their transactions.

We have specific experience in advising clients on the tax treatment of their transactions whether invested in Bitcoin, Litecoin, Ethereum or other similar cryptocurrencies.

The tax position will depend on the activities undertaken and the parties involved.

Your investment could be subject to capital gains taxCapital Gains Tax ("CGT") applies in certain cases when an asset is sold for more than it was originally purchased.  The taxable gain (profit) may be triggered following the transfer of an asset, although commonly this would follow a sale.  A number of tax reliefs are available to exempt or reduce the tax that may apply.  Basic tax planning may... More, income tax or corporation tax and it is necessary to review all matters on a case by case basis.

We can also advise on the implications of holding cryptocurrency as an investment within a UK company structure.

Whether you are a Bitcoin miner, trader, exchange, payment processer, service providers or speculative investor it is important to take advice.

If you require further advice in this area and want to ensure your UK tax affairs are all in order, please contact us.