UK Crypto investors who filed their taxes up to the last minute have less than a day before the HMRC deadline. Hope is on hand with tips from Koinly.
While it is important to seek professional advice on tax matters, software like Koinly can save hours tracking your crypto transactions and capital gains.”
– Danny Talwar
LONDON, UK, Jan. 30, 2023 /EINPresswire.com/ — UK crypto investors have until midnight on January 31 to report their crypto taxes to HMRC and pay – or face penalties – any taxes due must. Koinly, a cryptocurrency tax calculator, shares how investors can report their crypto tax to HMRC at the last minute.
For those who invested in crypto during the 2021-2022 financial year, HMRC would like to hear about it soon. Taxpayers have until January 31, 2023 to report any gains, losses or income from crypto investments to HMRC as part of their self-assessment tax return.
However, research conducted by Koinly has revealed that many UK crypto investors are finding it difficult to comply with crypto tax rules. While HMRC offers comprehensive guidance, the rules don’t always seem to be directly applicable to some of crypto’s more complicated transactions, as seen in the world of DeFi, yield farming, liquidity pools and staking.
In short, despite the lack of clarity, in order to calculate their crypto taxes, investors must calculate their cost basis, or fair market value (FMV) of each crypto in GBP on the day they received it; Identify each taxable transaction – including disposals of crypto and other crypto-related income; Identify which tax would apply to each taxable transaction (income tax or capital gains tax); calculate their capital gains and losses on each disposal of crypto using HMRC’s cost basis method of share pooling; and calculate the FMV of all crypto earnings in GBP on the day they received it.
It’s a lot of work for busy investors, especially those who may have filed their tax returns up to the last minute. Hiring a professional cryptocurrency accountant or cryptocurrency tax tool can help investors when their deadlines are tight.
Head of Tax at Koinly, Danny Talwar, explains: “With or without help, when time is of the essence, using a cryptocurrency tax calculator can save countless hours of the data collection process – and help you correctly assess your taxable income on those of HMRC rules.”
“Koinly is a cryptocurrency tax app providing UK crypto investors with convenient cryptocurrency income reporting online. While it is important to seek professional advice on tax matters, software like Koinly can save hours tracking your crypto transactions and capital gains,” adds Talwar.
Once connected, Koinly imports an investor’s trading history into the app. Koinly will determine a cost basis for investors for each asset. It identifies each taxable transaction and calculates your capital gains and losses using the share pooling method and the fair market value in GBP of all crypto earnings on the day you received them.
This service is available as part of a free plan and results in a summary detailing an investor’s taxable gains. However, to access a detailed report, users must upgrade to a paid account. From here they can then download a tax report for a specific tax year, which includes all the necessary details they need to submit.
Investors can submit their applications online via the UK Government Gateway Service.
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January 30, 2023 at 5:47 p.m. GMT
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