CryptoassetsMar 15 2023

Budget 2023: Cryptoasset tax return rules changed

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Budget 2023: Cryptoasset tax return rules changed
(REUTERS/Dado Ruvic/File Photo)
BySally Hickey

Income from cryptoassets will need to be identified separately in self-assesment tax returns under new rules outlined by the government.

In the Budget today (March 15), chancellor Jeremy Hunt outlined that in tax returns for the 2024-25 tax year, cryptoassets will need to be identified separately.

Cryptoasset holders may need to pay income tax and national insurance contributions on their tokens when they sell them.

If tokens are received from mining and not through trading, the tokens are treated as ‘other taxable income’.

They need to be declared unless the holder has received cryptoassets worth less than £1,000, or less than £2,500 in other untaxed income.

Cryptoasset holders must keep records of their tokens including the type, date and number received, number held in total and the value of the tokens in pounds. 

Cryptoassets are considered property for the purposes of inheritance tax, HM Revenue and Customs confirmed last summer.

In its guidance on the taxation of cryptoassets held by individuals, HMRC confirmed it would treat cryptoassets in the same way as it treats property for individuals who are domiciled or deemed domiciled for tax purposes.

But commentators have questioned the viability of this tax treatment, given that ownership of cryptoassets is not necessarily "tied to location" and regulators have "no agreement" on how to legislate.