UK Latest Crypto Tax Rulings Says BTC Is Not Real Money

The British government does not consider Bitcoin and the other cryptocurrencies to be money. Businesses that work with cryptocurrencies have new stipulations to take into consideration, because of an update of tax rules by Westminster. According to the UK latest crypto tax rulings, Bitcoin is not considered as real money as we are reading in the cryptocurrency news today.

A number of guidelines for individuals are published by the HMRC (HM Revenue and Customs), which were amended slightly last week on Friday. According to the latest guidelines, the companies will be obliged to declare all of the crypto-related business actions directly in their tax returns so they can become liable to pay the following taxes on their dealings: capital gains tax, income tax, corporation tax, stamp tax, VAT and National insurance contributions.

The value of the cryptocurrencies transactions in GBP should be calculated by the firms requires the HMRC, and also to include an explanation of the methodology they are using to calculate these calculations. HMRC adds in the document that it generally does not consider crypto for currency or “stock or marketable securities.’’

The fact that the HMRC does not regards crypto for currency is important in a precise way regarding cryptocurrency-based loans. It appears that the tax authorities would like to be uninvolved in matters of cryptocurrency loans.

The document outlines:

“HMRC does not consider exchange tokens [Bitcoin and major altcoins] to be money. In addition, there is typically no counterparty standing behind the token and, as such, it does not seem that the token constitutes a debt. This means that exchange tokens do not create a loan relationship.”

The document also shows that the companies choose to pay their staff in crypto but they also have to do so under ‘benefits in king’ rulings which mean that the National Insurance Tax and Income Tax are both payable in the same way as the employees would be paid in GBP. The UK latest crypto tax, clearly outlines that Bitcoin is not real money.
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The document previously published with guidelines for individuals as well expressed the same general rules. If in exchange for service are received Airdrops only then they will be subject to taxation. HMRC said that more rules would be promulgated, explaining that “The tax treatment of security tokens and utility tokens will be addressed in future guidance.”