Cryptocurrency taxation is a pretty topical issue, as digital currencies are more and more in demand lately. Nowadays it is quite often possible to see shops and restaurants accepting Bitcoin for payment.
For example, the UK is one of the countries in which the regulation of BTC circulation on the state territory is carried out at the legal level, and every year progress in this area is more and more.
For companies that accept cryptocurrency as payment for goods or services, there are no special conditions for the sake of making a profit or calculating taxable income, that is, taxation is carried out according to general rules.
Taxes on corporate income or corporate tax, gain or loss from foreign exchange transactions are taxed. In relation to BTC or any other cryptocurrency, the same legal standards are used that are accepted for the exchange of foreign currencies, loans.
So far, no special standards have been adopted on this issue.
When exchanging between BTC and the currency that is fundamental to the organization, no special tax conditions and rules are provided.
Gains and losses on transactions related to BTC and other digital currencies will be shown in the accounts and taxed under the usual conditions for levying corporate taxation.
Income received by individuals or legal entities in the United Kingdom from operations with any cryptocurrencies will be subject to taxation on a common basis.
With regard to the application of VAT in relation to transactions in BTC and any digital currencies, based on the explanation of the State. UK Customs and Tax Administration (HMRC) of 2014, for VAT purposes, cryptocurrencies will be interpreted as follows:
However, in relation to the supply of products, services from any suppliers, payments for which are made in cryptocurrency on the territory of the United Kingdom, VAT is applied in the usual manner.
The price for the supplied goods or services from which VAT will be deducted is set in pounds sterling, which is equivalent to the prices for the goods or services in digital currency at the exchange rate for the duration of the transaction.
If you have any questions about doing business related to Bitcoin or any other digital currency, it is always possible to ask highly qualified specialists of our company.
Specialists of Eternity Law International will offer you the most profitable solutions, which will be based solely on an individual approach to the client.