A working group has been set up to tackle the complexities of cryptoasset tax compliance for accountancy firms in the UK.
The Chartered Institute of Taxation (CIOT) and the Association of Taxation Technicians (ATT) aim to clarify uncertain accounting rules for cryptoassets.
An HMRC survey found that 10% of adults in the UK hold crypto assets, of which, 53% hold amounts of up to £1,000, whereas 7% have portfolios of around £5,000.
HMRC also identified nearly £2.3 million in suspected underpaid tax concerning cryptoassets in 2021/22, over five times more than the previous year.
The crypto market currently has a capitalisation of $900 billion as of summer 2022, a drop from $3 trillion in 2021.
Gary Ashford, chair of the working group for CIOT, said:
“The taxation guidance, while detailed in parts, is still in relative terms in its infancy, and as is the case with new, developing technology, the guidance will need to be developed and altered over time. I believe there will be a need for specific legislation.
“Given the growth of crypto generally, and the fact that many members of both the CIOT and ATT are facing clients with crypto assets, it is the right time for the joint working group.”
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