Cryptocurrency assets will become a separate category on UK tax forms

The latest legislation has been welcomed by the Chartered Institute of Taxation.

On March 15, the UK Treasury published a reporting document on the national budget for spring 2023. The document announces a change in self-assessment forms for cryptocurrency assets.

Further changes in the UK regarding cryptocurrencies

The UK is gradually developing its own comprehensive cryptocurrency framework. Therefore, the Ministry of Treasury introduced a separate category for cryptocurrency assets in tax return forms. A specific box should appear in tax forms in the years 2024 - 2025.

In the table of projected expenses and income of the national budget, the line for cryptocurrency assets appears only from 2025-2026. This means that the British would have to declare them for the first time in the previous tax year: 2024 - 2025. However, recent times have not been kind to British digital currency investors. Recently, the Binance exchange announced that it is withdrawing its operations from the UK.

Currently, the State Treasury has not provided any specific figures for projected budget revenues from this tax category - the figures in the table stand at the nominal level of 10 million British pounds (approximately 12 million dollars).

These changes have been welcomed by the Chartered Institute of Taxation (CIOT), the leading professional body analyzing the tax policies of individual countries.

“Emphasizing the need to declare transactions with cryptocurrency assets in the tax return will certainly help raise awareness of taxpayers' obligations in this regard,” said Gary Ashford, deputy president of CIOT.

Ashford went on to highlight the need for urgent and additional measures to address "widespread ignorance of tax payments and reporting requirements for digital currencies." According to him, high-income cryptocurrency investors do not have a sufficient understanding of tax reporting.

Earlier in March, the Financial Conduct Authority (FCA) told the Treasury that it was already "in the middle of a fairly ambitious reset" as the Financial Services and Markets Act passes Parliament. Once enacted, the new regulations would give the FCA new regulatory powers over the UK cryptocurrency industry.