Bitcoin

Aegis

Type_45 said:

Thank you for the above replies. To get some constructive tax feedback I'm going to attempt to share with you my exact trading history.

From late 2017 to May 2020 I used various platforms, so would have to dig those numbers up. But I'm confident that there's nothing taxable. I also did not have to do any Self Assessment tax returns in those years (17/18, 18/19, 19/20). Put about £9k in, it went up to £14k and then went down below £2k before settling at around £4,200. Would have to check how many trades I did but it wasn't excessive (ie, it wasn't the £49,500 in any tax year, which Bowlhead refers to on this thread.

In May 2020 I transferred into Coinbase from a separate wallet approximately £4,200. I did this because I find Coinbase easy to use and having a single platform is easier to keep track of transactions etc.

In the 20/21 tax year my transactions (buying, selling and converting crypto) totals £12,824 including fees.

In the 21/22 tax year my transactions (buying, selling and converting crypto) totals £18,266 including fees (so far, as we are still in this tax year).

I have downloaded my history spreadsheet from Coinbase which I can share, if necessary.

Please note that I will be doing Self Assessment tax returns for the 20/21 and 21/22 tax years.

Below is a basic breakdown of my buying/selling to-date:





So, do I have to declare anything on my 20/21 Self Assessment tax return? 

Is there anything I need to do?


Obviously we can't talk about the 21/22 Self Assessment tax return yet as we are still in the tax year and anything can happen. But as things currently stand, would I have to declare anything on the 21/22 Self Assessment tax return?

I have income from property (Rent a Room Scheme) which means I will do a Self Assessment tax return for 20/21 and 21/22. I have no other CGT gains.

(And before anyone says it, yes I know I'm not very good at crypto and after all this time I'm only £2,996 up and have spent the vast majority of my crypto life with losses. I am aware of that, thank you 🙂).

Don't forget to register your loss so that you can deduct it against future gains.  Details here:  https://www.gov.uk/capital-gains-tax/losses

Type_45

eskbanker said:

Type_45 said:

eskbanker said:

Type_45 said:

So, do I have to declare anything on my 20/21 Self Assessment tax return? 

Is there anything I need to do?


Obviously we can't talk about the 21/22 Self Assessment tax return yet as we are still in the tax year and anything can happen. But as things currently stand, would I have to declare anything on the 21/22 Self Assessment tax return?

You only need to declare chargeable gains that exceed the annual CGT threshold (currently £12,300), so, as you didn't make gains anywhere near that in 2020/21, no CGT declaration needed for that year.

You haven't made any disposals yet in 2021/22, so no CGT liability yet, but if you sell later in this tax year for a profit of over £12,300 then that would change.

Thank you for that. That's much appreciated. 🙂

Just to add - you may have only shared a cut-down version of your spreadsheet, but it's important to track individual holdings rather than aggregating your figures across all crypto assets, so if, for example, you buy into both BTC and XRP then you need to be able to identify purchase costs separately for each.  In other words, your spreadsheet should have a column for BTC purchases, another for BTC sales, then two more columns for XRP, etc....

Yes, the spreadsheet I keep is very simple just so that I can see where I'm at. 

Coinbase allow you to download a more detailed spreadsheet. I have attempted to take a photo of it below, but I'm not sure how legible it will be for you.

But I assume the below, in addition to the simple sheet I update, will suffice for tax purposes? Or do I, as you suggest, need to add columns to my existing simple spreadsheet in addition to the sheet below which Coinbase provide? 

Type_45

Zola. said:

Did you buy a load of alts? What was your basket?

I assume you bough a lot of bitcoin right at the very top of the 2017 bull market? 

You'll be able to see on the sheet I just uploaded a picture of for eskbanker. I've held various coins.

Yes, I was one of those who started out in December 2017 at the height of the bull market and then spent the next two years with a loss. I was £5k up at the start but that quickly changed!

By the time the market picked up in early 2020 I was so glad to have (most of) my money back that I sold. Even though I was still £1500 down. 

But I enjoy crypto and soon re-entered the market. 

Type_45

Aegis said:

Type_45 said:

Thank you for the above replies. To get some constructive tax feedback I'm going to attempt to share with you my exact trading history.

From late 2017 to May 2020 I used various platforms, so would have to dig those numbers up. But I'm confident that there's nothing taxable. I also did not have to do any Self Assessment tax returns in those years (17/18, 18/19, 19/20). Put about £9k in, it went up to £14k and then went down below £2k before settling at around £4,200. Would have to check how many trades I did but it wasn't excessive (ie, it wasn't the £49,500 in any tax year, which Bowlhead refers to on this thread.

In May 2020 I transferred into Coinbase from a separate wallet approximately £4,200. I did this because I find Coinbase easy to use and having a single platform is easier to keep track of transactions etc.

In the 20/21 tax year my transactions (buying, selling and converting crypto) totals £12,824 including fees.

In the 21/22 tax year my transactions (buying, selling and converting crypto) totals £18,266 including fees (so far, as we are still in this tax year).

I have downloaded my history spreadsheet from Coinbase which I can share, if necessary.

Please note that I will be doing Self Assessment tax returns for the 20/21 and 21/22 tax years.

Below is a basic breakdown of my buying/selling to-date:





So, do I have to declare anything on my 20/21 Self Assessment tax return? 

Is there anything I need to do?


Obviously we can't talk about the 21/22 Self Assessment tax return yet as we are still in the tax year and anything can happen. But as things currently stand, would I have to declare anything on the 21/22 Self Assessment tax return?

I have income from property (Rent a Room Scheme) which means I will do a Self Assessment tax return for 20/21 and 21/22. I have no other CGT gains.

(And before anyone says it, yes I know I'm not very good at crypto and after all this time I'm only £2,996 up and have spent the vast majority of my crypto life with losses. I am aware of that, thank you 🙂).

Don't forget to register your loss so that you can deduct it against future gains.  Details here:  https://www.gov.uk/capital-gains-tax/losses

Thank you very much for that. I will have a read of that link and see what I can do 🙂

eskbanker

Type_45 said:

eskbanker said:

Type_45 said:

eskbanker said:

Type_45 said:

So, do I have to declare anything on my 20/21 Self Assessment tax return? 

Is there anything I need to do?


Obviously we can't talk about the 21/22 Self Assessment tax return yet as we are still in the tax year and anything can happen. But as things currently stand, would I have to declare anything on the 21/22 Self Assessment tax return?

You only need to declare chargeable gains that exceed the annual CGT threshold (currently £12,300), so, as you didn't make gains anywhere near that in 2020/21, no CGT declaration needed for that year.

You haven't made any disposals yet in 2021/22, so no CGT liability yet, but if you sell later in this tax year for a profit of over £12,300 then that would change.

Thank you for that. That's much appreciated. 🙂

Just to add - you may have only shared a cut-down version of your spreadsheet, but it's important to track individual holdings rather than aggregating your figures across all crypto assets, so if, for example, you buy into both BTC and XRP then you need to be able to identify purchase costs separately for each.  In other words, your spreadsheet should have a column for BTC purchases, another for BTC sales, then two more columns for XRP, etc....

Yes, the spreadsheet I keep is very simple just so that I can see where I'm at. 

Coinbase allow you to download a more detailed spreadsheet. I have attempted to take a photo of it below, but I'm not sure how legible it will be for you.

But I assume the below, in addition to the simple sheet I update, will suffice for tax purposes? Or do I, as you suggest, need to add columns to my existing simple spreadsheet in addition to the sheet below which Coinbase provide? 

The Coinbase sheet has the raw data, but the onus is on you to calculate the CGT position every time you sell anything, i.e. you can't just throw either of those spreadsheets at HMRC in the form they're in.  Up to you exactly how you do that but the key is to be able to identify the acquisition cost of anything you sell, in order to work out the gain, and if you make multiple purchases of the same type then you need to pool them to give an average unit cost.

Type_45

eskbanker said:

Type_45 said:

eskbanker said:

Type_45 said:

eskbanker said:

Type_45 said:

So, do I have to declare anything on my 20/21 Self Assessment tax return? 

Is there anything I need to do?


Obviously we can't talk about the 21/22 Self Assessment tax return yet as we are still in the tax year and anything can happen. But as things currently stand, would I have to declare anything on the 21/22 Self Assessment tax return?

You only need to declare chargeable gains that exceed the annual CGT threshold (currently £12,300), so, as you didn't make gains anywhere near that in 2020/21, no CGT declaration needed for that year.

You haven't made any disposals yet in 2021/22, so no CGT liability yet, but if you sell later in this tax year for a profit of over £12,300 then that would change.

Thank you for that. That's much appreciated. 🙂

Just to add - you may have only shared a cut-down version of your spreadsheet, but it's important to track individual holdings rather than aggregating your figures across all crypto assets, so if, for example, you buy into both BTC and XRP then you need to be able to identify purchase costs separately for each.  In other words, your spreadsheet should have a column for BTC purchases, another for BTC sales, then two more columns for XRP, etc....

Yes, the spreadsheet I keep is very simple just so that I can see where I'm at. 

Coinbase allow you to download a more detailed spreadsheet. I have attempted to take a photo of it below, but I'm not sure how legible it will be for you.

But I assume the below, in addition to the simple sheet I update, will suffice for tax purposes? Or do I, as you suggest, need to add columns to my existing simple spreadsheet in addition to the sheet below which Coinbase provide? 

The Coinbase sheet has the raw data, but the onus is on you to calculate the CGT position every time you sell anything, i.e. you can't just throw either of those spreadsheets at HMRC in the form they're in.  Up to you exactly how you do that but the key is to be able to identify the acquisition cost of anything you sell, in order to work out the gain, and if you make multiple purchases of the same type then you need to pool them to give an average unit cost.

Thank you very much for that. That's very helpful and I think I can indeed get those figures together from the sheets I have without too much trouble. 

This is why I stick to Coinbase since May 2020. Because it's easier to keep tabs on things like this. There may be cheaper/better exchanges out there but having everything in one place and the ease of use of Coinbase is worth something too, IMO.

Scottex99

Malthusian said:

Scottex99 said:

Haha, ask anyone in that building what Uniswap is

Why should they care? HMRC are only interested in your capital gains, not where or how you made them.

I doubt anyone in HMRC knows the first thing about chemical engineering, it doesn't change their ability to levy CGT if I make a lot of money in a chemical engineering business and then dispose of it.

Hence my question, I’m happy to declare but not at the expense of me spending 6 months explaining each of the 10,000 trades I did this year between CEXs/DEXs/Staking/LP Pools. The majority of people aren’t going to declare squat

eskbanker

Scottex99 said:

Malthusian said:

Scottex99 said:

Haha, ask anyone in that building what Uniswap is

Why should they care? HMRC are only interested in your capital gains, not where or how you made them.

I doubt anyone in HMRC knows the first thing about chemical engineering, it doesn't change their ability to levy CGT if I make a lot of money in a chemical engineering business and then dispose of it.

Hence my question, I’m happy to declare but not at the expense of me spending 6 months explaining each of the 10,000 trades I did this year between CEXs/DEXs/Staking/LP Pools. The majority of people aren’t going to declare squat

You're not required to explain anything, but simply to calculate and declare your taxable gains (if they exceed the annual CGT threshold), regardless of how challenging that may be - scale is no mitigation!

Not sure whether your last sentence is actually suggesting mass tax evasion, large scale ignorance, or an assertion about how few people actually exceed CGT thresholds, but what supports your view that it applies to the majority?

Scottex99

And what if you don’t know how? HMRC aren’t going to know how either. I know people who have traded on exchanges that don’t even exist anymore, good luck getting a CSV for that. 

I am suggesting mass tax evasion actually, not as a technique but as the reality. Young people making a lot of money on crypto are likely not declaring any of it, as they assume HMRC will never find out or the reasons above.

Most project owners or people in the space for years that are now very wealthy are just moving to Dubai, Miami, Portugal, Panama, Belize…. Or little Gibraltar, where I’m based. No CGT

eskbanker

Scottex99 said:

And what if you don’t know how? HMRC aren’t going to know how either. I know people who have traded on exchanges that don’t even exist anymore, good luck getting a CSV for that.

Ignorance is no defence!  Likewise difficulty - if people don't keep adequate records of asset acquisition prices that's their problem, not that of HMRC, who state that the cost is assumed to be zero in such cases, unless there's evidence to the contrary.

I'm quite happy to accept that you know more than me about crypto, and you may even know more than HMRC, but that doesn't matter, anything involving acquiring and disposing of assets potentially brings CGT into play, regardless of jargon that may disguise that fundamental principle.

Scottex99 said:

I am suggesting mass tax evasion actually, not as a technique but as the reality. Young people making a lot of money on crypto are likely not declaring any of it, as they assume HMRC will never find out or the reasons above.

Most project owners or people in the space for years that are now very wealthy are just moving to Dubai, Miami, Portugal, Panama, Belize…. Or little Gibraltar, where I’m based. No CGT

Not sure what the relevance is of people relocating away from UK tax jurisdiction, the thread is about CGT liabilities for those tax resident in the UK.

You may be right that some won't declare when they should but you didn't answer the question of how you support your assertion about the majority of people evading tax?