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    • Keen_Investor
    • By Keen_Investor 13th Jan 18, 8:47 PM
    • 10Posts
    • 0Thanks
    Cryptocurrency Bought on Limited Compay
    • #1
    • 13th Jan 18, 8:47 PM
    Cryptocurrency Bought on Limited Compay 13th Jan 18 at 8:47 PM

    Is it possible to form a limited company as one person (Myself) being the sole director. Then buy Cryptocurrency using that company.

    The reason I ask is, I want to invest in Cryptocurrency over the long term, and reduce tax as much as possible legally on any gains when I eventually sell.

    So corporation tax instead of Capital Gains tax. Or are there rules in place that would make this not possible?

    Not sure of any implications?

Page 1
    • TheCyclingProgrammer
    • By TheCyclingProgrammer 13th Jan 18, 10:27 PM
    • 3,176 Posts
    • 1,853 Thanks
    • #2
    • 13th Jan 18, 10:27 PM
    • #2
    • 13th Jan 18, 10:27 PM
    Why invest through a Ltd company?

    Through a Ltd you!!!8217;ll pay 19% CT on any gains (this should reduce to 18% in 2020) but you!!!8217;ll have no allowances and additional costs and paperwork running the company.

    Then, to extract those profits from the company as a dividend you!!!8217;ll pay further income tax on those dividends (7.5% at basic rate and 32.5% higher rate). If your gains are high enough you!!!8217;d need to consider extracting your profits over multiple years to avoid pushing your total income over the 100k threshold or you!!!8217;d start losing your personal allowance.

    Invest personally and you have an 11.3k tax free CGT allowance and depending on whether you!!!8217;re a basic rate or higher/additional rate payer and your total gains you!!!8217;ll pay either 10% or 20% in CGT.
    • HappyHarry
    • By HappyHarry 13th Jan 18, 10:30 PM
    • 640 Posts
    • 912 Thanks
    • #3
    • 13th Jan 18, 10:30 PM
    • #3
    • 13th Jan 18, 10:30 PM
    There is no theoretical reason why not, though there is not a great deal of difference in CGT for higher rate taxpayers and corporation tax.

    However, how would you then extract the profit from the company without paying further tax?

    Edit: crossed post with TheCyclingProgrammer!!!8217;s much more detailed response!
    Last edited by HappyHarry; 13-01-2018 at 10:33 PM. Reason: Crossed post
    I am an Independent Financial Adviser. Any comments I make here are intended for information / discussion only. Nothing I post here should be construed as advice. If you are looking for individual financial advice, please contact a local Independent Financial Adviser.
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