United Kingdom: New Crypto Tax Break for Foreign Players

United Kingdom: New Crypto Tax Break for Foreign Players

The new year has brought a major crypto reform in the United Kingdom in the shape of a tax exemption on all crypto purchases by non UK residents and foreign investors though local UK-based crypto offering institutions.

The nation’s government tax authority, the HM Revenue and Customs, talked to Coindesk that it aims to attract international digital coin investors and strengthen the local industry. The HMRC states that in order to make the UK a hub for crypto investments and transactions, the authorities have exempted international users from certain rules that apply to local crypto traders “so that funds which include them aren’t put off from appointing UK managers”.

Currently, the UK lacks a tax regime pertaining to cryptocurrencies, despite the current HMRC’s practice of imposing capital gain and income tax on crypto trading and investments. The HMRC can track crypto transitions – since 2014 – but only for centralizes exchanges. For decentralized ones it lacks the authority to do so. Despite this, there are plans of taxing decentralized platforms at some point in the future.

The new tax mandate came into being on the 1st January 2023 after Rishi Sunak, the new Prime Minister of the UK, revealed his plans to make the UK a global crypto hub.

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