The UK Tax Collection Service Issues Its First Tax Legislation For Crypto Holders

The tax collection service in the United Kingdom published its first tax legislation for all private crypto holders after a long consultation period and this is what we read today in our crypto news.

In the new policy text, ‘’Cryptoassets for Individuals,’’ tax obligations are mentioned for private investors who get paid but also who buy and sell cryptocurrency. After many months of uncertainty among the UK taxpayers, the latest information they got is that they need to report to authorities about their crypto holdings.

All individuals can pay the Capital Gains Tax or Income Tax depending on what type of crypto transactions they conduct.
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In case an individual receives a payment from an employer in cryptocurrency, the employee has to pay social security contributions-National Insurance.

In the paper you can read that:

 “The tax treatment of cryptoassets continues to develop due to the evolving nature of the underlying technology and the areas in which cryptoassets are used. As such, HMRC will look at the facts of each case and apply the relevant tax provisions according to what has actually taken place (rather than by reference to terminology). Our views may evolve further as the sector develops.”

In cases where for example a hacking of a wallet occurs, the victim will still own the assets and has the right to ask for their recovery.

According to the paper:

 “Those who pay for and receive crypto assets, may be able to make a negligible value claim to HMRC if they turn out to be worthless.”