In its latest effort to become a global cryptocurrency hub, the United Kingdom has introduced a tax exemption for non-residents and foreign investors. The exemption applies when users purchase digital assets through local investment managers or brokers.
As part of newly elected Prime Minister, Rishi Sunak’s, efforts to make the U.K. a global cryptocurrency hub, a new crypto tax break for non-residents and foreign investors came into effect on January 1, 2023. The news was first reported by CoinDesk, which said that the U.K. government’s tax arm, the HM Revenue, and Customs, said in an email:
This exemption is an important factor in attracting global investors, meaning foreign investors won’t be brought into U.K. tax simply by appointing U.K.-based investment managers.
It continued to say:
To build upon the U.K.’s position as an investment management hub, this exemption has been extended to include crypto assets, so that funds which include them aren’t put off from appointing U.K. managers.
The United Kingdom already has a tax guide in place for resident cryptocurrency traders and in July, the HM Revenue and Customs issued a consultation to obtain the views of investors and professionals on how the country should go about taxing decentralized finance.
Bank of England Says Crypto is Too Dangerous Not to Regulate
The Bank of England recently made statements regarding the danger of cryptocurrencies and the absolute need to regulate the industry. The deputy governor of the BoE warned that crypto trading is simply “too dangerous” to remain unregulated and added that it could pose “a systemic problem” should action not be taken. The deputy governor added that the BoE might soon regulate the industry in an attempt to protect investors against the danger of crypto trading, as well as the wider financial system against the fallout associated with crypto. The BoE’s stance is that retail investors should be able to safely speculate on crypto, as they do in traditional markets.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
