Blockchain assets present a lucrative emergent marketplace for those who are willing to invest. Wisteria can help you navigate the tax implications involved, ensuring you declare the right type and levels of tax to HMRC.
Our extensive expertise in cryptocurrency taxation, coupled with our commitment to staying ahead of regulatory changes, ensures that your financial affairs are handled with utmost care and precision.
At Wisteria we have specialist knowledge in this field and understand the practices involved in trading and acquiring crypto across the various marketplaces and exchanges. This coupled with comprehensive knowledge and experience as tax advisors, positions Wisteria as one of the leading specialists in this emergent field, keeping organisations and individuals safe and legally compliant.
Our services are tailored towards the exact nature of the client and the way they deal with blockchain assets. From corporate entities to individuals, the needs of each client can vary greatly.
Cryptocurrency Taxation: Expert Guidance to Navigate Regulatory Changes
It is important to keep accurate records of all cryptocurrency transactions, as HMRC has the power to investigate and assess individuals for tax liabilities, and penalties may be imposed for failure to disclose or inaccuracies in tax returns.
It is also worth noting that the UK tax treatment of cryptocurrency is subject to change as regulations and laws are constantly evolving. At Wisteria we are constantly on the pulse with these changes; able to provide professional advice on the tax implications of cryptocurrency transactions.
In the UK, the trade of cryptocurrency and NFTs (non fungible tokens) is subject to tax, governed by Her Majesty’s Revenue and Customs (HMRC). As blockchain assets are considered a form of property, the buying and selling of crypto and NFTs is subject to capital gains tax, in the event that a profit has been made as a result of their value increasing since they were acquired.
Mining or earning cryptocurrency via another means is often considered a form of income and should be declared as such. As with any earnings minus your tax free allowance, this is subject to income tax.
Cryptocurrency & NFT Case Studies
Case Study 1:
Our team assisted an individual with a diverse cryptocurrency portfolio that spanned various online exchanges. They had disposed of some crypto assets, cashing out into standard currency, while others were converted into different cryptocurrencies, and some were simply held. We provided consultancy on the tax treatment of holding versus disposing of the investments, confirmed the pooling requirements for each coin held, calculated the capital gains tax, and assisted with declaring it to HMRC.
Case Study 2:
A client had become interested in cryptocurrency and started investing as a supplementary income alongside their full-time job. They were uncertain whether the money made from trading should be considered income or capital. We conducted a comprehensive analysis, cross-checked the badges of trade with the individual's circumstances, and determined whether to declare income or capital gains tax.
Case Study 3:
Our team worked with a corporate entity (PLC) that had various contracts and sponsorships with large cryptocurrency clients and well-known coins. Some sponsorship contracts were paid in blockchain assets that had been converted into others. We calculated the tax liability based on the cryptocurrency payments the client received and assisted in declaring the correct level of corporation tax for each invoice settled in crypto.
FAQs
Personal
Can I do my own accounting?
It’s possible to do your own accounting. However, hiring an accountant can provide numerous benefits to a business. By entrusting your financial matters to a professional, you can free up valuable time and resources that would otherwise be spent on bookkeeping and tax preparation. An experienced accountant can provide valuable insights and recommendations to help you make informed business decisions, and ensure that you stay compliant with tax laws and regulations. They can also help you identify opportunities for cost savings and provide guidance on how to improve your financial performance. In short, hiring an accountant can provide a wealth of benefits to a business and is an investment that can pay off in the long run.
How can Wisteria help with inheritance tax planning?
Wisteria offers intergenerational wealth planning services, which can provide guidance on how to manage inheritance tax, particularly in areas with high property prices.
Why should small businesses consider using Wisteria's payroll services?
Small businesses often have limited time and resources to manage their payroll effectively. Wisteria can walk businesses through the payroll process and ensure that it is done accurately and on time.
How can Wisteria help with non-resident landlord tax returns?
Wisteria offers expert guidance on the technicalities of non-resident landlord tax options for those considering investing in the property market.
What services does Wisteria offer for landlords?
Wisteria offers a range of services for landlords, including property advice, accounting services, tax advice, and non-resident landlord tax options.
What are the benefits of hiring an accountant?
Hiring a good accountant is a wise decision for any business; an accountant can help you save money and stay on top of your finances. When you work with an experienced accounting firm like Wisteria, you can rest assured that your books are in good hands. Every business owner understands the importance of handling their financial information with care. Shelving and filing receipts and invoices, managing bank accounts, tracking payroll records and preparing tax returns are all important tasks for any business owner to complete. Hiring a professional accountant can free up your time to focus on other aspects of your business that require attention and growth.
Why should landlords consider property accounting services or tax advice?
Tax and accountancy rules for landlords and property investors are changing, and accessing property accounting services or tax advice can help landlords stay compliant and minimise their tax bills.
Why is hiring an accountant important?
A good accountant can help reduce or eliminate the time spent on financial tasks, allowing you to focus on growing your business and generating profits. The burden of handling those tasks will no longer be on your shoulders. An accountant will document your income and record how you spend your money so that you can focus on growing your business by making it more profitable.
Why is it important to seek support during a tax investigation?
Tax investigations can be stressful and overwhelming, and it is essential to seek experienced and knowledgeable support to navigate the complexity of tax rules and penalties. Wisteria can provide the necessary guidance during this time.
Does Wisteria provide support to landlords and property businesses?
Yes, Wisteria works with many buy-to-let landlords and property businesses providing support in relation to accounting, financial, and tax affairs.
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