HMRC sets out cryptoasset guidance for businesses

06 Nov 2019

HMRC has issued guidance on the tax treatment of cryptoassets in order to clarify the rules for businesses.

The UK tax authority has stressed that it does not consider cryptocurrencies to be either currency, stock or marketable securities. This means that any corporation tax legislation, which relates solely to currency, does not apply to cryptoassets.

However, the guidance makes clear that if a business is carrying out activities that involve exchange tokens, they are liable to pay tax on them. This would include activities such as buying and selling exchange tokens; exchanging tokens for other assets or cryptoassets; 'mining' assets; and providing goods or services in return for exchange tokens.

HMRC notes that the crypto sector is fast developing, and the terminology, types of coins, tokens and transactions can vary. It says it will look at the facts of each case and apply the relevant tax provisions accordingly.

HMRC also requires businesses to keep records of cryptocurrency transactions in pounds sterling, and to keep records of the valuation methodology for these transactions. Firms are expected to record the amount spent on each type of exchange token. 

Late last year, HMRC published cryptocurrency taxation guidance for individuals, clarifying several taxation issues related to airdrops, forks and mining.

Register for our Monthly Newsletter -

Why not register to receive our Monthly Newswire?

Once a month we'll send you an email packed full of essential business news and handy tax tips to help save you money.

Sign up today »

Tel: 01749 685000

Email:

Chalmers HB
20 Chamberlain Street
Wells
Somerset
BA5 2PF


Contact us | Credits | Accessibility | Disclaimer | Help | Site map |

© 2019 Chalmers HB. All rights reserved.
We use cookies on this website, you can find more information about cookies here.

Chalmers HB Limited, Registered in England, Registered number 4233537, Registered Office: 20 Chamberlain Street Wells Somerset BA5 2PF. Chalmers HB Audit Limited, Registered in England, Registered number 9739736, Registered Office: 20 Chamberlain Street, Wells, Somerset BA5 2PF.