Bitcoin Forum
September 21, 2018, 03:12:55 AM *
News: ♦♦ New info! Bitcoin Core users absolutely must upgrade to previously-announced 0.16.3 [Torrent]. All Bitcoin users should temporarily trust confirmations slightly less. More info.
 
   Home   Help Search Donate Login Register  
Pages: [1]
  Print  
Author Topic: Bitcoin tax advisors (UK)  (Read 111 times)
kblaidd
Newbie
*
Offline Offline

Activity: 23
Merit: 9


View Profile
December 23, 2017, 12:04:14 PM
 #1

So... I've cashed out enough Bitcoin to pay off the mortgage and pay 28% capital gains tax on it. I spent £10 on Bitcoin in January 2011 when you could still buy them with Paypal.

I've outlined the situation briefly to my Mum's accountant who says it all sounds pretty straightforward. Obviously I visit exchanges and read Bitcoin news and google therefore sends me lots of adverts for accountants who specialise in dealing with Bitcoin tax issues.

Is there any point in going to one of these firms? It strikes me that I might end up paying them a lot of money for advice on a straightforward issue. I know there is a suggestion that sufficiently speculative transactions count as gambling and are therefore untaxed. However whilst it feels as if I've won the lottery, another part of me feels that it was just a particularly good investment and should have been treated as such. In which case, simple..?
1537499575
Hero Member
*
Offline Offline

Posts: 1537499575

View Profile Personal Message (Offline)

Ignore
1537499575
Reply with quote  #2

1537499575
Report to moderator
1537499575
Hero Member
*
Offline Offline

Posts: 1537499575

View Profile Personal Message (Offline)

Ignore
1537499575
Reply with quote  #2

1537499575
Report to moderator
Advertised sites are not endorsed by the Bitcoin Forum. They may be unsafe, untrustworthy, or illegal in your jurisdiction. Advertise here.
darkangel11
Legendary
*
Offline Offline

Activity: 1162
Merit: 1050


View Profile
December 23, 2017, 09:29:31 PM
 #2

So... I've cashed out enough Bitcoin to pay off the mortgage and pay 28% capital gains tax on it. I spent £10 on Bitcoin in January 2011 when you could still buy them with Paypal.

So my first question would be why did you choose to pay 28%? AFAIK 28% is the higher bracket tax on the sale of residential property. Other assets are charged 20%.
You have it all here: https://www.gov.uk/capital-gains-tax/rates

Quote
Is there any point in going to one of these firms? It strikes me that I might end up paying them a lot of money for advice on a straightforward issue. I know there is a suggestion that sufficiently speculative transactions count as gambling and are therefore untaxed. However whilst it feels as if I've won the lottery, another part of me feels that it was just a particularly good investment and should have been treated as such. In which case, simple..?

Yes, I think you should consult someone if you have a lot of money on the line. For a mere £10k in BTC you have potentially saved £800 if I'm right about the tax rates that apply in your case. You can always ask them how much they're charging before you decide.

Also, if I were you I'd divide my assets into smaller parts to make sure I'm within the basic rate band each year (£33,500) and pay 10%. If you have a lot of money on the line (100k) dividing it into 3 years like that can save you £10k.
kblaidd
Newbie
*
Offline Offline

Activity: 23
Merit: 9


View Profile
December 24, 2017, 12:28:17 AM
 #3

Thank you for that! I had somehow missed that the 28% rate applied only to gains on residential property and carried interest. I think I must have been reading some older pages on CGT as I get the impression the rules have changed. Anyhow, it means I have considerably more money to spare than I thought.

I think your other advice is good, but not applicable to me. Basically I sat on my £10 worth of bitcoins for 7 years until they came to represent a life-changing amount. About £300k all told. Paying off the house is a big deal - I'd be really upset if I lost out on it. If BTC goes to $0 tomorrow it's been a fun adventure and I've done well out of it and won't be sad. I've hung on to a few as I think it more likely that they'll go up, but there's no guarantee of that. So the coins are now cash, but I had to convert a sufficient sum within this tax year or else I would have risked missing the boat. I wouldn't have cashed out at all last year as they would have represented a nice but not life-changing amount of money.

There's no question that I will be speaking to an accountant. My question is whether I should be talking to a specialist accountant, e.g.:

https://www.dnsassociates.co.uk/blog/bitcoins-tax-implications-uk

or whether the accountant up the road would be likely to do an equally good job.

I suppose the other option would be talking to HMRC directly as it appears I may not have to pay tax at all:

https://bitlegal.io/2015/05/05/tax-treatment-of-speculative-digital-currency-transactions-uk/.

I feel slightly ambivalent about this as I am quick to condemn tax-dodging companies or rich people who use loopholes. I work in the public sector. Taxes pay my wages, and I work very hard for them. On the other hand, I wouldn't condemn anyone who won the lottery and didn't pay tax... and I feel as if I've won the lottery. One day my overdraft and credit card hit -8K so I dusted down my old computers and found I'd bought 10 x more bitcoin than I remembered. Had I known how well they were going to do, I'd have spent £20 rather than £10.
darkangel11
Legendary
*
Offline Offline

Activity: 1162
Merit: 1050


View Profile
December 26, 2017, 07:42:28 PM
 #4

I'm not an expert but at first glance the HMRC are focusing on the speculative income like the one you'd get from gambling, but it won't cost you to ask whether there's a chance of you paying a lower rate. If there are loopholes don't be afraid to use them as long as they're safe and won't end up costing you. I always say that if the law doesn't forbid something then it's allowed. You are in a tight spot financially, so you have every right to try to save up and get yourself back on track.

IMO your case it's fairly straightforward. You kept coins for years, cashed out all at once, need to add it to your yearly statement. I believe any accountant will be able to do it, as long as they have an idea what a cryptocurrency is. They know how to deal with a profit from stocks, bonds, currency trading, they will know what to do with your bitcoin money.

I know it may look like you've won the lottery but it's an investment like any other. If you had invested some money 3 months ago and wanted to cash out now with 5x profit it would be a similar thing.

Honestly, I find myself thinking about the old days and wishing I had bought more than I did. Should have sold everything and taken a credit  Smiley
kblaidd
Newbie
*
Offline Offline

Activity: 23
Merit: 9


View Profile
December 27, 2017, 01:51:03 AM
 #5

Hmm... In what way can you get a speculative income from Bitcoin? The methods I can think of are 1) having mined a block before mining became a commercial proposition and 2) having bought in very early on when it was an asset class unlike any other, and therefore by definition speculative. 3) having gambled using bitcoins. Perhaps it's this latter possibility to which they are referring.

Somehow 20% tax feels a lot less punitive than 28%. I think I'll contact HMRC directly and see whether they can clarify what they meant by their phrase about speculative income.
agelay
Newbie
*
Offline Offline

Activity: 3
Merit: 0


View Profile
February 22, 2018, 10:36:58 AM
 #6

Hello, can i somehow contact you, or write a message due to taxes question?
kblaidd
Newbie
*
Offline Offline

Activity: 23
Merit: 9


View Profile
February 22, 2018, 11:52:42 AM
 #7

Sure. PM?
agelay
Newbie
*
Offline Offline

Activity: 3
Merit: 0


View Profile
February 22, 2018, 08:30:07 PM
 #8

Sure. PM?

User 'kblaidd' has not chosen to allow messages from newbies. You should post in their relevant thread to remind them to enable this setting.

I have tried  Smiley Uppermentioned message was appeared. As far as I understood from now on, to turn crpto into cash i need to pay tax?
kblaidd
Newbie
*
Offline Offline

Activity: 23
Merit: 9


View Profile
February 22, 2018, 09:36:13 PM
 #9

OK, I've changed the setting and you're welcome to PM me.

In summary, whether you need to pay tax depends on where you live, how much you've earned from your bitcoins, and perhaps (in the UK) whether they are classed as an investment or as gambling. Also may depend on whether you've mined them, and if so whether you were doing so as part of a hobby or a for-profit enterprise.

I have contacted an accountant but not yet engaged their services. I have found the contact details for HMRC but not yet contacted them myself. When I have further information I will post here again openly, in the hope that it will be of use to someone else.
kblaidd
Newbie
*
Offline Offline

Activity: 23
Merit: 9


View Profile
February 25, 2018, 07:43:32 PM
 #10

Quote
Taxes
« Sent to: kblaidd on: February 23, 2018, 06:09:51 AM »
« You have forwarded or responded to this message. »
   Reply with quoteQuote ReplyReply Remove this messageDelete
!!! WARNING: This user is a newbie. If you are expecting a message from a more veteran member, then this is an imposter !!!
First of all, thank you for answer and make me chance to write you pm). So it depends on the country what taxes are to pay. (Sorry for English - I am non-English speaker).
Report To Admin
agelay
Newbie
*
Offline

Activity: 2
Merit: 0



View Profile Personal Message (Offline)
Trust: 0: -0 / +0
   
Donations
« Sent to: kblaidd on: February 24, 2018, 04:09:39 AM »
« You have forwarded or responded to this message. »
   Reply with quoteQuote ReplyReply Remove this messageDelete
!!! WARNING: This user is a newbie. If you are expecting a message from a more veteran member, then this is an imposter !!!
Good morning kblaidd,

First of all i want to appology for distrub you. I have read few your posts over here. Find that you have get access to your old btc wallet. So please accept my congradulations, hopefully it will make your life to better one.

I know that its stupid from me, but anyway I will try. I will tell you my story a little bit.
So, actually i got in trap. And it would be good, if its have an impact on me.

So, money have been always problem for most of people. I have grew up in friendly family in the "developing counrty", have finished school and went to university. For that time, i my aim was to help my parents at least a little bit, due some circumstances which happen.

I have graduated and have approx 350$ salary a month, which is not to bad. But I stepped away.  For the last 8 months life become very hard, due to some problems with spine i was need get money for treatment, about 1000$, to avoid my parrents worried about me i decided to take a debt, as i dont have good friends that could borrow me some amount. But another problem i have faced, that almost all banks which provide a credits reject me, and only one give 100$, and i did not remember how, but i get acquinted with pay-day loans. But at that time i was thinking only to solve that. So for first few months, i was spending all my salary for paying off % for payday loans, but one day i got extra spends happen and get another payday loan... I dont have nothing for sale, no car, no accomodation and my parents live in a small flat. So i again decided to keep silence about. But debt begin to grew uo drammatically. 2% daily for me was to hard, after 3 month i got 1500$ debt there, i paid of all my salary and additionally was working for renting a room and for food. Then  its get out of control... My parents trying to help me, as well took credit to cover percents. As 3.5% daily will be if will not pay at that time. Now its its a huge amount, thousands dollars. I was working for 18 hours a day, but eveything i was spend for pay off debts, crouwdfunding websites are will not help me. If it had no impact on my parents, friends its was fine, as ot my stupid actions, however, it is what it is. A shame. I know that there are people in a world who are in more difficult situation... The way to back to life is closed. Few months ago i wrote to pineapplefund, however they had rule, no donations to individuals. But there are no charities who are helping individuals. A cant get any social loan or any help whatever. Over 1000% yearly its a trap into debt pitch.

I would kindly ask you to help me get out of this situation. If you can make any donations or you can help find me somehow get out of this situation... Or you can provide a credit with low percentage... It would very apprecieted. If you need evidence, i will provide all documents... If you dont want to donate btc, i would kindly ask to donate any btc forks or whatever...

Sorry again for such message, hopefully you will be not annoying.

Kindest regards,
agelay
Report To Admin
agelay
Newbie
*
Offline

Activity: 2
Merit: 0



View Profile Personal Message (Offline)
Trust: 0: -0 / +0
   
Re: Donations
« Sent to: kblaidd on: February 24, 2018, 09:49:52 AM »
   Reply with quoteQuote ReplyReply Remove this messageDelete
!!! WARNING: This user is a newbie. If you are expecting a message from a more veteran member, then this is an imposter !!!
Thank you anyway, just one question about. Mostly everybody talking that they are donating only to charities, but why ? I mean there are no evidence as well that money spend on non-profit charities will go to their destination (fully or not).
Report To Admin
agelay
Newbie
*
Offline

Activity: 2
Merit: 0



View Profile Personal Message (Offline)
Trust: 0: -0 / +0
   
Credit
« Sent to: kblaidd on: Today at 07:47:24 AM »
   Reply with quoteQuote ReplyReply Remove this messageDelete
!!! WARNING: This user is a newbie. If you are expecting a message from a more veteran member, then this is an imposter !!!
Good morning kblaidd,

I'm sorry again, but anyway you can credit me? With low percents rate? And after you claim forks, can you give your old btc wallet? For some research...

Kindest regards,
Agelay

It seems you have very little interest in bitcoin taxation, doesn't it.
Pages: [1]
  Print  
 
Jump to:  

Sponsored by , a Bitcoin-accepting VPN.
Powered by MySQL Powered by PHP Powered by SMF 1.1.19 | SMF © 2006-2009, Simple Machines Valid XHTML 1.0! Valid CSS!