A look back at the most popular digital asset stories from the past few weeks...
HMRC launched a new initiative encouraging the voluntary disclosure of unpaid tax on crypto assets. In addition to cryptocurrencies, the initiative also relates to unpaid tax on crypto assets such as NFTs and utility tokens.
The number of years required for disclosure under the scheme depends on the reason why taxes went unpaid. If crypto asset taxes were unpaid despite reasonable care being taken the maximum period of disclosure is four years.
If reasonable care was not taken the maximum period of disclosure is six years and if individuals deliberately misled HMRC about crypto asset taxes the maximum period is 20 years.
Despite this, crypto asset taxes can only apply to the last 14 years as the first crypto asset, Bitcoin, was launched in 2009. Taxes will be subject to HMRC's typical late payment interest charges with disclosures rejected if the correct interest and penalty payments are not applied. [Read more]
The Swiss city Lugano began accepting payments for taxes and municipal services in cryptocurrencies Bitcoin and Tether.
Tether is a stablecoin with unit value pinned to the US dollar. Bitcoin began being accepted for taxation in the northern Swiss canton Zug and the southwestern municipality of Zermatt in 2020.
Lugano, located in the South of the country near the border with Milan, announced that residents can now scan a QR code to pay city invoices. Previously cryptocurrency payments could be made in the city's online portal.
The QR-bill, facilitated by cryptocurrency company Bitcoin Suisse, forms part of Lugano's Plan B initiative, delivered in partnership with Tether, intended to encourage the use of Bitcoin throughout the city. [Read more]
With use of cryptoassets growing, HMRC has urgied people to avoid potential penalties and check if they need to complete a Self Assessment tax return for the 2022 to 2023 tax year.
Anyone with cryptoassets should declare any income or gains above the tax-free allowance on a tax return. Tax may be due when a person:
- Receives cryptoassets from employment, if they’re held as part of a trade, or are involved in crypto-related activities that generate an income
- Sells or exchanges cryptoassets, including:
- Selling cryptoassets for money
- Exchanging one type of cryptoasset for another
- Using cryptoassets to make purchases
- Gifting cryptoassets to another person
- Donating cryptoassets to charity [Read more]