25 July 2016
Find out more

UK rejects VAT on bitcoin trades

03 March 2014  |  4577 views  |  0 bitcoins

Her Majesty's Revenue and Customs (HMRC) has decided not to levy a 20% value-added tax on bitcoin transactions, reversing an earlier ruling that classified virtual currencies as gift vouchers.

In contrast to several other countries, including Germany, the UK is set to treat crypto-currencies in the same way as other currencies.

In a brieing paper setting out its thoughts, HMRC states: "As an EU tax, the VAT treatment for cryptocurrencies adopted by the UK must be consistent with any treatment that may eventually be implemented across the EU."

VAT will not be charged on virtual currency transactions and margins will not be taxed. Other taxes, including corporation tax, will apply, although “each case will be considered on the basis of its own individual facts and circumstances".

The small win for the crypto-currency community comes after a tough few weeks in the wake of the Mt. Gox meltdown. Following Friday's revelation that the exchange is filing for bankruptcy protection, a US customer has initiated legal proceedings.

In a complaint filed in US District Court in Chicago, plaintiff Gregory Greene says: "Mt. Gox intentionally and knowingly failed to provide its users with the level of security protection for which they paid."

Greene's suit seeks class action status on behalf of Mt. Gox users, restitution, monetary damages and other remedies.

Meanwhile, in an effort to deal with hoards of furious users, the Tokyo-based exchange - which says that it has lost bitcoins worth hundreds of millions of dollars - has set up a call centre. Callers have been posting their experiences, including language barrier issues, on Reddit.

KeywordsCALL CENTRES

Comments: (0)

Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

Mt. Gox files for bankruptcy protection; Yellen says Fed has no authority to regulate bitcoin

Mt. Gox files for bankruptcy protection; Yellen says Fed has no authority to regulate bitcoin

28 February 2014  |  5566 views  |  1 comments | 7 tweets | 10 linkedin
MT Gox goes up in smoke. Is this the end for bitcoin?

MT Gox goes up in smoke. Is this the end for bitcoin?

25 February 2014  |  6666 views  |  5 comments | 15 tweets | 10 linkedin
US state regulators investigate virtual currencies; Mt. Gox chief quits Bitcoin Foundation

US state regulators investigate virtual currencies; Mt. Gox chief quits Bitcoin Foundation

24 February 2014  |  6079 views  |  1 comments | 7 tweets | 6 linkedin
French Senate holds bitcoin hearing

French Senate holds bitcoin hearing

16 January 2014  |  4065 views  |  2 comments | 7 tweets | 3 linkedin
Singapore lays down tax rules for bitcoin business

Singapore lays down tax rules for bitcoin business

09 January 2014  |  4577 views  |  0 comments | 9 tweets | 8 linkedin
Indian bitcoin exchange shuts after central bank warning

Indian bitcoin exchange shuts after central bank warning

02 January 2014  |  6729 views  |  1 comments | 7 tweets | 3 linkedin
Bitcoin tanks after Chinese exchange blocks new deposits

Bitcoin tanks after Chinese exchange blocks new deposits

18 December 2013  |  4760 views  |  0 comments | 9 tweets | 4 linkedin
Norway says bitcoin an asset, not a currency

Norway says bitcoin an asset, not a currency

16 December 2013  |  5563 views  |  2 comments | 11 tweets | 6 linkedin
Swiss to vote on proposals to treat bitcoin as foreign currency

Swiss to vote on proposals to treat bitcoin as foreign currency

10 December 2013  |  35210 views  |  0 comments | 31 tweets | 13 linkedin
Senate Committee sets date for bitcoin hearing

Senate Committee sets date for bitcoin hearing

11 November 2013  |  6938 views  |  0 comments | 6 tweets | 4 linkedin
Bitcoin firms meet UK govt officials as regulation looms

Bitcoin firms meet UK govt officials as regulation looms

06 September 2013  |  9315 views  |  1 comments | 7 tweets | 6 linkedin
Bitcoin Foundation meets US lawmakers

Bitcoin Foundation meets US lawmakers

27 August 2013  |  6759 views  |  0 comments | 7 tweets | 5 linkedin
US govt seized $2.9m from MT. Gox's Dwolla account

US govt seized $2.9m from MT. Gox's Dwolla account

20 August 2013  |  7320 views  |  0 comments | 8 tweets | 3 linkedin
Germany declares bitcoin 'private money' and subject to tax

Germany declares bitcoin 'private money' and subject to tax

19 August 2013  |  8534 views  |  0 comments | 13 tweets | 10 linkedin
US judge rules bitcoin is real money

US judge rules bitcoin is real money

08 August 2013  |  10265 views  |  0 comments | 16 tweets | 10 linkedin

Related blogs

Create a blog about this story (membership required)
Visit capgemini.comVisit www.abe-eba.euVisit VocaLink.com

Who is commenting?

A Finextra member Finextra Member Commented on: UK startups get Brexit...
A Finextra member Finextra Member Commented on: Apps crush internet fo...

Top topics

Most viewed Most shared
MasterCard agrees £700m VocaLink acquisitionMasterCard agrees £700m VocaLink acqu...
8919 views 14 comments | 32 tweets | 37 linkedin
satelliteContactless Bitcoin startup Plutus Tap &am...
8745 views comments | 9 tweets | 3 linkedin
hands typing furiouslyWhat Every FinTech CEO Should Know About R...
8510 views 0 | 15 tweets | 8 linkedin
hands typing furiouslyBanking on IoT: Security in the Internet o...
8342 views 3 | 20 tweets | 7 linkedin
Santander doubles down on fintech fundSantander doubles down on fintech fund
7820 views comments | 22 tweets | 28 linkedin

Featured job

Find your next job