Posted 2 years ago | by Ben Armstrong
Crypto Exchanges are Starting to Take Heat From the U.K.
If you live in the U.K. and have been skirting around your country's cryptocurrency tax laws, then you may want to read this. HM Revenue & Customs has been applying pressure to crypto exchanges in order to get the names and transaction histories of their customers. This is an attempt for the British government to try to reclaim tax revenue that has escaped them to this point.
While no crypto exchange has publicly commented on this issue, it is believed that Coinbase, eToro, & CEX.IO have all received letters requesting the information. A tax insider was quoted as saying:
HMRC is looking to work with exchanges when it comes to finding information on people who have been buying and selling crypto. I think they will only go back a couple of years, two or three years.
The interesting thing about these comments is that the people who made the most money in crypto, were invested long before the last 2-3 years. And people who invested in the last year and a half mostly have lost money and could show a loss on taxes.
While it appears on the surface to be about collecting money that is already due, this may be more of an attempt for the government to obtain data on people's current holdings than it is to actually get money back in taxes. Many governments across the world have realized that there is virtually no way for them to track digital currencies unless they get the assistance of these exchanges. It seems as if this could be an attempt to establish a baseline of who has what.
In the United States, the Internal Revenue Service (IRS) recently sent out letters to many crypto investors warning them to pay their taxes. Basically, a warning shot across the bow to those who seek to avoid taxes. The U.K. tax authority looks to be doing the same. Only time will tell how much cooperation the exchanges are willing to give.
To see more about this story and more, check out BitBoy Crypto's latest video: