Declare crypto on Self-Assessment tax return?

wmb194

Given you only have fours year to do it you might want to declare capital losses to 'bank' and use against future gains but it sounds like it might be too much effort to figure out the numbers correctly.

https://www.gov.uk/capital-gains-tax/losses

https://community.hmrc.gov.uk/customerforums/cgt/b2d1a3f5-2274-ee11-a81c-6045bd0ae839

1404

I'm actually quite looking forward (in a way) to putting down on a spreadsheet exactly what my annual trades have been. That way I have those figures to hand and know where I stand (like I do with the GBP figures in my original post).

I know I don't have tax to pay. That's not my concern. But I don't want to get in trouble for not declaring something on my SA tax return which I should've been doing. 


So, as of right now (until I get my trading figures) the feeling is that I didn't (and still don't) need to be putting my crypto on my tax return? 

masonic

1404 said:

So, as of right now (until I get my trading figures) the feeling is that I didn't (and still don't) need to be putting my crypto on my tax return?

Probably not, but it will depend on how much coin swapping you've been doing. It must have been very challenging to hold £10k-ish in crypto since late 2017 and lose money, when the asset class has gone up 10-fold. Suggests a lot of counterproductive trading going on.

EthicsGradient

1404 said:

I'm actually quite looking forward (in a way) to putting down on a spreadsheet exactly what my annual trades have been. That way I have those figures to hand and know where I stand (like I do with the GBP figures in my original post).

I know I don't have tax to pay. That's not my concern. But I don't want to get in trouble for not declaring something on my SA tax return which I should've been doing. 


So, as of right now (until I get my trading figures) the feeling is that I didn't (and still don't) need to be putting my crypto on my tax return? 

You would only need to put anything about your crypto dealings on the tax return if your gross total sale values are above £50k in the tax year. Since the total value is currently only about £15k (ie under a third of the £50k), you would have had to be trading frequently and heavily to have turned over more than 3 times the worth, in one year.

As eskbanker says, it's important to establish what the cost basis for whatever you currently hold is, so that when you do sell it in the future, you can say "yes, I sold X bitcoin when it was worth £7,000, but that cost me £5,500, so it's only a gain of £1,500" or whatever.

And since you currently have an overall loss, it is worth it, for you, to establish if you have disposed of any cryptocurrency at a loss - it's possible you might be able to set that against future gains, but you have to tell HMRC about the losses within 4 years of them happening. How losses can be carried forward like that is a bit complicated, and I've never done it myself, so you'd need to read up carefully on it.

1404

masonic said:

1404 said:

So, as of right now (until I get my trading figures) the feeling is that I didn't (and still don't) need to be putting my crypto on my tax return?

Probably not, but it will depend on how much coin swapping you've been doing. It must have been very challenging to hold £10k-ish in crypto since late 2017 and lose money, when the asset class has gone up 10-fold. Suggests a lot of counterproductive trading going on.

As shown in the OP, I sold everything in December 2020 (at a £1500 loss) and started again in January 2021. The market then peaked in 2021, whereupon I threw in more money, and then crashed. And my main holdings (XRP and XLM) are only now recovering again. Despite BTC having had a good run in the meantime.  

I think my choices of XRP and XLM probably account for much of the extended losses. 

I will share the trades I've made when I have them for anyone who's interested in how not to do crypto!

Scottex99

Haha.

Buy high, sell low that’s how we do it in retail trading.

i dont rate it but XRP might get you back in the green if it carries on recent performance 

1404

Does anyone have a template for a spreadsheet they use to log crypto trades for tax purposes?

1404

Scottex99 said:

Haha.

Buy high, sell low that’s how we do it in retail trading.

i dont rate it but XRP might get you back in the green if it carries on recent performance 

In October 2021 (the market peak, as far as my crypto is concerned), my crypto was worth £21.5k (I'd paid £18.8k for it).  By May 2022 it was £6.8k.  And the average monthly value of my crypto portfolio from May 2022 until October 2024 has been £5541.  Only in this month, November 2024 have I seen a resurgence, thanks to XRP and XLM finally having a bullrun and my crypto is now suddenly £15.5k (just over £3k off the GBP which I put into it 3+ years ago.


So hopefully, yes, XRP and XLM will get me out of the hole.  I may then sell some and reduce my position, but I haven't got that far yet.

Bostonerimus1

If your exchange/platform doesn’t track your annual CGT etc liabilities from sales then that can be a real pain. Tracking cost basis can get complicated very quickly especially with multiple buys and sales.

Crypto is too volatile for me and until it actually starts to displace traditional currencies and becomes more than speculative vapour I won’t go near it. But if you are disposed to buy it, do it on a platform that provides good account and cost basis tracking.

1404

Bostonerimus1 said:

If your exchange/platform doesn’t track your annual CGT etc liabilities from sales then that can be a real pain. Tracking cost basis can get complicated very quickly especially with multiple buys and sales.

Crypto is too volatile for me and until it actually starts to displace traditional currencies and becomes more than speculative vapour I won’t go near it. But if you are disposed to buy it, do it on a platform that provides good account and cost basis tracking.

Absolutely.  It's for this reason that my investments outside of crypto are only within an ISA along with a few sovereigns/Britannias - all of which are tax free.

Crypto is the only thing I dabble in which attracts tax.  And it's a nightmare.  And that's not mentioning the fact that I've never realised any gains from it whatsoever.