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Mmonriver

Profits and Tax (UK)

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Hi all,

Can anyone shed any light as to the taking of any profits with regards to CGT in the UK?

As CSC is focussed on gambling, could this possibly mean no CGT?

 

Edited by Mmonriver
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Good question and something I've been thinking about. If you buy CSC and gamble and win and cash out there's zero tax to pay...so if you buy CSC, hold and cash out without betting is it 20% CGT or tax free....? hmmmm :JC_thinking: I don't know.

Edited by CasinoCoin
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I did a bit of digging into this a while back and came upon this Tax accountant company that addresses the "tax on crypto" question directly here. They have some videos somewhere on their site that explain it well, but the gist is that it all boils down to how you see (or more like how you portray to the HMRC) your investment into crypto:

 

Quote

Taking into account HMRC’s guidance and the applicable legislation, cryptocurrencies could be held, and should be distinguished for tax purposes, for the following reasons:

  • Speculatively – tax-free gains.
  • For personal use and expenditure – tax-free gains.
  • As an investment – subject to capital gains regime. The amount subject to CGT for an individual (10/20%) and corporation tax (19%) for a company.
  • As a trading asset – as such the profits are subject to income tax for an individual (20/45/45%).

So basically if you buy it for use, it's just like any other currency, you dont pay tax on it. If you bought it speculatively, again its tax free. If you bought as an investment, it's subject to capital gains tax. If you bought it to trade as an asset, you would need to inform HMRC of the profits of the trade, which would then be subject to income tax.

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Also, on that site they state:

Quote

Crypto activity that is classed a ‘hobby’ is non-taxable.

I think this goes back to buying it speculatively.

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7 minutes ago, New2CSC said:

How do you explain or show that you bought CSC speculatively rather bought as an investment?

Yeah, that’s odd...

You just tell them??... :sarcastic:

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11 minutes ago, LeGonze said:

Yeah, that’s odd...

You just tell them??... :sarcastic:

Pretty much 😂 there's no real way to prove you bought as an investment or not, it's all about what you tell them, or what your accountants tell them I guess... 

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Yeah it very odd... A lot of potential money can be made and/or lost dependant on how you or your account explains that this was bought speculatively... 

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So if I make 1 million and when CSC is adopted by casino's, I'll put it all on roulette, cover every number adequately to ensure no loss, cash out and walk away with my stash earned through gambling. 

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4 minutes ago, Mmonriver said:

So if I make 1 million and when CSC is adopted by casino's, I'll put it all on roulette, cover every number adequately to ensure no loss, cash out and walk away with my stash earned through gambling. 

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You could cash out your CSC tax free if you were to play games with a low house edge like Blackjack or Baccarat. You aim to break even or lose a tiny amount which would be much better than paying 20% CGT.

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£27,500 straight up on every number would return £990,000 guaranteed. I'll have £10,000 left over to throw on red just to make it interesting 😉 

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I was thinking about this a while ago, and had a similar idea to place long-term sports bets (e.g. Liverpool to win the premier league) and cash out almost straight away making a small loss. One thing I did think was that there is likely to be a maximum amount that you're allowed to bet, I doubt you could just rock up on an online casino and place ~£30k on every number (not that I would know) or put £1million on Liverpool to win 😕

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11 hours ago, TheKeiron said:

Pretty much 😂 there's no real way to prove you bought as an investment or not, it's all about what you tell them, or what your accountants tell them I guess... 

Actually in Germany the difference is the amount of time you owned the coin before cashout. Longer than one year is an investment. Maybe the same in the UK.

Edited by BumFuzzle

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On 12/18/2018 at 11:47 AM, New2CSC said:

How do you explain or show that you bought CSC speculatively rather bought as an investment?

A very good agurement would be your first purchase... For example: "5 tenths of a penny"??, that sounds speculative too me :spiteful:🤑

Edited by Jack-of-Spade

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