“Our new Constitution is now established, and has an appearance that promises permanency; but in this world nothing can be said to be certain, except death and taxes.”
Benjamin Franklin
I was talking with one of my friends the other day who is just getting into Bitcoin and other cryptocurrencies when the question came up regarding tax and what the governments stance was regarding Bitcoin.
It appears that like with everything in life the government wants their share. I did some digging and found some information which relates to the UK's stance on the taxation of cryptocurrencies and one paragraph that jumped out at me was this,
"For investors in Bitcoins, the sterling equivalent of gains made in any tax year will, where exceeding the annual capital gains tax allowance of £10,900 (for 2013/14) be chargeable at 18 per cent to 28 per cent."
So if someone makes say £15,000 from Bitcoin they would be taxed 18% to 28% on £4100. So £1148 at 28%. To me this doesn't seem right as you could be holding this in cold storage, doing nothing with it but still having to pay tax?
I don't know much about holding gold and silver but if I had a bar of gold I purchased for £1000 and over the course of the year it was then worth £1500, so £500 more but I did nothing with it surly I would not need to pay tax on that gain until the time I came to sell it?
Just like with owning a classic car or a Rolex.
The line that confuses me is "For investors in Bitcoin" so simply by having it stored you are an investor regardless if you actually sell and make a profit?
There must be something I am missing here? Is the Government expecting people to file a tax return every year and pay tax on "profits" each year?
Thanks for any advice
As usual thanks for listening
Happy Steeming Steemers and Steemettes.
If you like this you may like my other recent posts:
Monday Memories #3 - The Nintendo Game Boy 🎮👦
https://steemit.com/gaming/@somecoolname/monday-memories-3-the-nintendo-game-boy
When people upvote and comment on a post before they have even read it !!!?
Bitcoins value & why it's hard to be an answer to our current financial system.
Retro Review - Syphon Filter (Playstation)
https://steemit.com/gaming/@somecoolname/retro-review-syphon-filter-playstation