UK Authorities Declare Renewal of Crypto Tax Regulations
Earlier this week, the UK Crypto Asset Taskforce published its very first report which declares that the tech used in the creation of digital currencies and further applications and uses of DLT might be beneficial to multiple industries, especially the financial services market. Therefore, the Taskforce will push for the legitimization of activities focusing on cryptoassets and DLT in the United Kingdom.
The report states that in terms of priorities, lessening the risks of existing crypto assets comes first and foremost. Due to the global environment where crypto scams, fraud, money laundering and much more thrive in every dark corner of the crypto sphere, safety and security is crucial. The Taskforce sees no significant obstacles hindering DLT adoption but it states that the current tech needs to be developed to ensure its capacity to be used at scale.
Despite it not being the focus of the report, it was mentioned that the tax issues regarding cryptoassets are being carefully studied by HM Treasurer and HM Revenue & Customs. In the months to come, those who should pay taxes on cryptoassets will use the new guidelines. The existing guidance is available on HMRC’s website. These guidelines will be renewed by 2019 based on the Taskforce’s findings.
The UK is also focusing on formalizing the regulations regarding ICOs in the country. The report declared that in the early days of 2019, the authorities will launch a discussion with the community to study whether the UK market will contain ICOs and if they need an expansion on existing regulations, and more.
Suggested Measures to Take
The report also claims that the authorities will decrease the probability of the dangers cryptoassets present to the sector's integrity and to increasingly monitor any hazards that may threaten financial stability, and that they will additionally prevent illegal dealings in digital currencies. The report declares that while the usage of cryptos is not high, the risk for illegal activities like money laundering is indeed ever-increasing.
The report demands clearer structure of the regulations regarding ICOs, security tokens, and instruments of finance that reference the currencies and tokens available at exchanges. It also recommends that authorities worldwide should cooperate to raise awareness in regards to crypto investment and its risks.
The Taskforce should get together at least one time every 6 months to review the existing approach and study potential developments in order to create consistently upgraded reports and results.