Crypto tax crackdown – UK leads global taskforce
A Crypto tax crackdown was announced today by HMRC. The UK will lead an international effort to crack down on individuals evading taxes through the use of cryptocurrencies.
Today, the UK has reached a ground breaking agreement with 48 countries to address this issue. This global commitment marks a significant step towards closing the gap in the global tax system. It looks to potentially recover hundreds of millions of pounds in lost revenue.
This initiative follows the UK’s leadership in the historic G20/OECD global tax deal of 2021, which aimed to combat corporate tax avoidance and ensure proper tax payments are made in the correct jurisdictions.
The Crypto-Asset Reporting Framework (CARF)
The introduction of the Crypto-Asset Reporting Framework (CARF), represents the OECD’s latest effort to enhance tax transparency.
Under this framework, crypto platforms will be required to share taxpayer information with tax authorities. The aim is to facilitate better enforcement of tax compliance. Today’s achievement builds upon the two-pillar global tax agreement of 2021. This seeks to ensure that businesses pay the appropriate taxes in the locations where they operate. It targets multinational corporations avoiding taxes through a 15% global minimum rate.
Victoria Atkins, the Financial Secretary to the Treasury, emphasised the UK’s commitment to combating global tax evasion and securing essential revenue for public services. The CARF will complement the existing Common Reporting Standard. the Government states that which has proven successful in combating offshore tax evasion and recovering nearly £100 billion in additional tax revenue from traditional financial assets.
Crypto tax crackdown – advice to stay compliant
it is important to understand you tax liabilities with regards to crypto. HMRC has set up a dedicated disclosure facility to declare crypto tax. If using this, it is important to seek professional advice first, as calculating tax on many transactions, sometimes tens of thousands can be complex and errors can occur, even when using specialist software.
HMRC is also sharing date with many organisations, so you may receive a letter from them. it is important not to ignore these and act promptly, failure to do so is likely to result in a formal tax investigation (more on this here).
Alexander & Co – crypto tax experts
Alexander & Co has a specially trained team of crypto tax advisors providing industry leading advice to clients. This includes assisting clients where they have received correspondence form HMRC.
To stay compliant in this rapidly evolving sector, our cryptocurrency tax advisors are able to assist you.
Our team at Alexander & Co is experienced in dealing with the tax issues surrounding crypto. Whether you’re an investor, trader or a business, we can help you ensure your affairs are structured correctly, in the most tax-efficient way, while remaining compliant with the latest HMRC cryptocurrency legislation.
To speak with a member of our cryptocurrency tax team, email info@alexander.co.uk or simply fill out the contact form below and we will be in touch.
