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Translated by: Formosa Taiwan English Team – Kelvin Liao
On May 24th, Mr. William Je, Founder of Himalaya Exchange, published an article on “Bloomberg Tax”, explaining the tax issues of digital currency.
The UK’s tax authorities are reviewing investors of cryptocurrencies in order to prompt awareness of the tax implications that may occur when dealing with cryptocurrency assets. In regard to the tax issues related to cryptocurrencies, Mr. Je said that investors need to be aware that if an individual is deemed to have received cryptocurrency in trading, mining and receives crypto as part of an employment remuneration package, etc., then the profits should be subject to income tax. If there is no disposal of the cryptocurrency, there usually is no tax due. If cryptocurrency is sold for cash, used to purchase other valuable assets, or exchanged for another cryptocurrency such as Bitcoin, Ethereum, this would be considered as capital gains by UK law, and should be filed tax accordingly.
In addition, due to the large frequency of cryptocurrency trading, the exchange platform may only keep records of transactions for a short period of time, Mr. Je reminds investors to keep transaction records as soon as possible, including the type of assets, date of transaction, whether they are bought, sold or exchanged, the number of units involved, the value of the transaction, the cumulative total, as well as bank statements and wallet addresses, etc. Keeping good records can be very useful for tax filing at a later time. It is important to be mindful that UK may impose severe penalties on those who fail to report their profits correctly.
Proofread/Edited by: Grace
Posted by: Peter Chen
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