CGT

nacentaeons

Not in the UK. Unless you had to do some ‘work’ in order to earn them. They are on subject to CGT once you cash them out. Check out HMRC CRYPTO21250.

phaattiee

Sorry this is just completely false. 1. Privacy and Self-Custody/Decentralisation are not one and the same. 2. You can purchase from an exchange with KYC regulation, but the minute you transfer to a cold storage device you're back in the realm of anonymity. As long as nobody gains access to it and can prove its in your possession you're once again in control of a private asset with complete anonymity. - I actually agree with more KYC from exchanges, you don't have to use them, BTC is as anonymous as transacting with cash or bartering in any other form of peer to peer transaction. KYC regulation and legislation on futures/leverage trading BTC is a good thing, it makes it more reliable and less prone to volatile price action and will encourage investment from normies. 3. Even Gold doesn't have 100% anonymity unless you mined it out the ground yourself buried it in a safe and told absolutely nobody you had it... At that point its worthless, Until you use it to transact, the minute you do so you're giving up complete privacy... at least the person you're transacting too knows you have gold... they might not know how much or where its kept but they know you have it or did have it. 4. People should pay CGT on their BTC when they transact. Your bins aren't emptied for free, you roads aren't maintained for free, your children's education isn't free, MOST IMPORTANTLY, your RIGHT TO PRIVACY isn't free, its enforced, my government backed soldiers with their guns and bullets and tanks and helicopters and drones and AC130's and special forces and Navy and airforce and... you get the idea. Yes we like privacy, more of it the better, but also there's a limit and balance to everything. Anyone that expects 100% privacy is hiding from something, big or small.

Silver-Rub-5059

Hardly worth the risk of it not dropping to the 40’s, especially if you have to pay CGT on your epic gainz.

Jumpy-Locksmith6812

Probably good to say every 5 years you pay CGT (or get a rebate if price falls!) then this is your new basis. Chuck some inflation rules in there to be fair. This is then just collecting early. Give people the option to do it early or late to avoid being screwed by a bull market.  This may force sales but hey this ain’t bad because what a lot of companies do is buy back stock instead of paying dividends effectively moving income into capital gains.  A system like this will claw back that loophole for the rich somewhat.

MonsieurGump

They were in already but not in a tax efficient wrapper. A lot of the retail in the ETF is people that sold BTC to rebuy in a way that reduces CGT.

mastermilian

I would argue that crypto has already been killed as a medium of exchange. For one, it is treated as an asset and triggers a CGT event in most countries. Ultimately, there is no practical purpose of having 2000 crypto-currencies. If people genuinely want to transact with a digital currency, they're going to be eventually funnelled into using a CBDC. We know where this is headed and the only reason to hold crypto at this stage is either for speculation or to keep your assets safely outside the traditional financial system that's eroding our wealth.

phaattiee

Yeah you haven't got a clue... read the first paragraph and realised you're just a delusional capitalist. 1. Once your initial investment has been recouped your equity is no longer at risk... you're broke even... its your profit that's at risk... Which you should be paying yourself back for anyway... the longer you own a profitable business and pay yourself a salary the more this is reinforced... Once you as an individual are net positive you can't claim your initial investment is at risk... 2. Business' go bankrupt, people don't, your company is an LLC you can declare bankruptcy and still keep your personal assets and house and family etc in tact if you bungle your business up so bad you go bankrupt. Start a new business, get a job, IDK shit happens. 3. One of the most successful companies to work for in the UK is the John Lewis partnership that operates exactly on that principle, Its an employee owned company. If you can't comprehend that every cog in your machine is required to operate successfully and therefore should be oiled just the same every year come service time then you don't deserve to have a successful business with hard working employee's. Sorry to break it to you mate but you're the problem not the solution. I might not be able to contribute beyond this because I'm from the UK so I'm not familiar with US tax systems... Not to mention my solution for the last paragraph was mentioned in my first post... Allow unrealised losses on CGT to be carried over the same way the unrealised profits are taxed... its a headache for book keepers an accountants but It would allow you to offset losses in one area against the increases in others all without having to buy and sell... swings and roundabouts... You literally didn't supply any solutions after I asked what you suggest other than what Flatten the tax code.... LMAO that would just wreck the lower income class even further... you know the one that is now earning roughly 5x less now on average than people were 50-60 years ago... You sound like a proper smooth-brain conservative mate.

Krebbin

First of all, never keep that amount on an exchange. Next you'll need to trade your crypto for fiat, nobody does that for free. You'll probably need expert advice on those amounts. Then any large deposit in a bank will get reported to Tax authority, so ecpect to pay a huge slice in CGT. You should probably hire a tax sdvisor. If you're lucky you'll come out with about 75% of what you started with😋

BrickSufficient6938

We've very different CGT systems "out there" like some have none cgt at all, some yes but include crypto, some have certain yearly untaxabke allowance... to all inclusive 50%. Funny world.

Life-Duty-965

>is a currency Yeah one of my local IT shops accepts bitcoin so I treated myself to an rx4090 and 7800x3d when we broke 70k. Don't worry hodlers, that was just a small amount of my gains and without my country's CGT personal allowance. My tax allowance resets so I will cash out again. Keep buying you guys!! Thanks for your hardwork as I'm gonna have some fun gaming. One day y'all gonna buy me a Lambo. Hodl!!!

passthesugar05

yep the absolute highest would be 48.5% including medicare levy and medicare levy surcharge, but that's assuming you're in the highest tax bracket, have no private health insurance and no CGT discount. that rate is being paid by almost no one, the average person will be paying 32% come july, and that's cut to only 16% if you hold for a year

riceyrolling

50 was exaggerating a tad. If your in top tax bracket and not trading as a business, it's income tax. Unless you have a CGT discount (holding more than 12 months) your paying the income tax rate. So actual highest would be 45%.

jfunk4

To all that hodl indefinitely, aren’t you concerned about a million dollar CGT bill when you finally exchange your btc for goods/services in the future? It’s not like you’re avoiding the tax implications forever. They will just get larger as your btc gains increase. Unless of course US govt scraps CGT for cryptocurrency.

blue419

The great thing about taxes is that they make hodling easy. Every time i get those paper hands, im reminded of the 30% CGT I'll have to pay, and i look back at my hands, and they turn to diamond again. Thanks taxman, you are keeping me from being a dumbass.

the2nicks

Bank hasn’t been an issue, yet, I’d hope they’d contact me before freezing my account! They can see the CEX where money has gone to and come from so I’d hope they put two and two together. HMRC. Yes, technically they do require a list of sales, specifically how they relate to buys, to determine pooling, 30-day and same-day rules, to ensure their tax rules are correctly applied. To be honest, this and the resulting CGT was one of my biggest worries with crypto. I tried to put it all together in a spreadsheet but found it too complicated trying to get the rules working properly. I looked at and tried a few software offerings, some didn’t work “properly”, ended up using Koinly which imported the CEX data correctly, allowed me to make the relevant adjustments and generated the necessary HMRC reports. I’m not a fan of HMRC. I think they make it all too easy for us to make mistakes and then punish us for it. Depending on whether you’re classed as a casual investor (CGT) or a trader (Income Tax) the taxes are different. Putting aside that 8 don’t like paying any tax (!) CGT is actually quite favourable, there’s no NI and the tax rate starts at 10%. And if you post a loss one year you can carry it forward x years against future gains. I hope that helps. Good luck. https://www.gov.uk/hmrc-internal-manuals/cryptoassets-manual/crypto22256

Skypangs

CGT Hidden gem

Amazing-Ad-8239

9k every day into a personal account will raise flags! If it's into a business account or mortgage account it's okay. But you need it to spend it so neither of those will work. If you know somebody with a business than can front the bank transfer, I would say give the cash to them and have them transfer it but even then, they'll probably have to pay tax on it putting it in. I would recommend you give it them and just double check with an accountant but they could probably deposit it in a few deposits without any flags, you'll just have to pay the tax on that which will definitely be a lot less than CGT as it's a business tax bracket!

RattledSabre

All we can do is work to averages. On the basis of avg. $300 per month, starting halfway through 2014. That would be in the region of $35.1k total invested for a total of 28.6 BTC. At today's price, that's a little over $1.8m. Let's assume CGT at 20% on the profit element, so take out \~350k in tax. Leaving $1.4m to purchase 80% of a $1.75m house. There are many variables here, all of which could paint a very different story. But as a straight-down-the-middle estimate, looks like a real success story. Congrats on the dream house!

Infections95

Sold before CGT in the UK went to 3k. Bought sol for £11 December 2022 and sold Feb this year for 10x in a year.

CalmWolverine8369

Is it worth it for possible extra CGT and the uncertainty of what you might think will happen.

Odd_Monk_132

You should not post how much you have, maybe edit that out and use percentages instead? It sounds like you have a mix of different investments and you could easily shift some of your allocation to bitcoin comfortably. Come up with a plan for what % allocation you want in bitcoin and go with that. CGT is about 20%? If you think bitcoin is going to do more than 20% then that re-allocation of capital will make sense.

Substantial-Skill-76

What's the point of bitcoin if 'additional taxes' are going to wipe it out? I dont think that's true. I'll have to pay taxes eventually. The CGT tax limit is only 3k per year now (in UK) so there's virtually no saving there anymore (£500 per year). And fiat is decreasing in spending power 5-10% per year anyway......i wouldnt be stupid enough to keep my money in fiat any longer than i have to.

TomSurman

Me, I've just accepted that 20% of my profits are going to be taken from me, and am factoring that into my cash-out plans. There's not really a good way around it. The way I see it, if I'm paying capital gains tax, it's because I've made profit. So as unfortunate as CGT is, I don't really see it as something to complain too much about. And at least it's not taxed like income at 40%.

G_u_e_s_t_y

So can someone explain to a noob how this type of govenment interference can't happen with Bitcoin? People are already paying CGT on profits from it, and using central exchanges to buy/sell it.

MachaMacMorrigan

This one is in the UK, and has been musing about Portugal (no CGT).

1UazZNfbWi

tl;dr (repost) Disposals of bitcoin via exchanges which are banks may be exempt from UK Capital Gains Tax if made on or after 7 Sep 2021. # # # Further to my original post (https://np.reddit.com/r/Bitcoin/comments/pjh4r3/as_a_currency_of_el_salvador_btc_is_now_exempt/), S.35 of the Finance Act (2012) (https://www.legislation.gov.uk/ukpga/2012/14/section/35) amended the Taxation of Chargeable Gains Act (1992) so that gains made on foreign currency held in bank accounts are not liable to UK Capital Gains Tax with effect from 6 April 2012 (I have changed the wording to make it more precise). The legal wording is: [CGT] does not apply in relation to a gain accruing to a person [an individual or trustee (not a trader)] on a disposal of a foreign currency debt [owed by a bank in a currency other than sterling and represented by a sum standing to the credit of an account-holder in an account in that bank]. The steps are: An individual [UK citizen] transfers BTC to an exchange that has a banking licence. This is not a taxable event as it is like for like. Also HMRC principle 'a man cannot trade with himself' [see Ayrshire Employers’ Mutual Insurance Association Ltd v CIR (1946) 27TC331]. The BTC is now a 'debt owed by a bank in a currency other than sterling and represented by a sum standing to the credit of an account-holder in an account in that bank'. (It has changed from being sovereign money to being debt-based money). It only remains to argue that, since BTC is legal tender in El Salvador it is a foreign currency [currency other than sterling]. Since CGT only applies to gains when they are realised (not when they are made), CGT should not apply to gains on disposals made from banks on or after 7 September 2021, even if the gain was made before then. The bitcoin can be held in any bank (does not have to be El Salvadorean or UK). HMRC says in its crypto manual (https://www.gov.uk/hmrc-internal-manuals/cryptoassets-manual/crypto22550) 'HMRC does not consider cryptoassets to be currency or money. This reflects the position previously set out by the Cryptoasset Taskforce report (CATF). This means that sections 252 and 269 Taxation of Chargeable Gains Act 1992 do not apply.' However the CATF published their opinion in October 2018 and only considered whether bitcoin was currency or money in the UK. Bitcoin was adopted as legal tender in El Salvador in September 2021. Use this information at your own risk but don't come crying to me if HMRC shuts this loophole while you're hesitating. See also https://www.gov.uk/hmrc-internal-manuals/capital-gains-manual/cg78321

GrandWazoo0

Yep, it’s also been a 4 day weekend so everyone in UK pretty much has had a chance to mull over their plans to utilise that CGT allowance…

BasisOk4268

End of tax season in 4 days in the UK. Our CGT Tax Free allowance is halving

harvested

Right, but the CGT can explain the staggered sell of as holdings reach minimum age requirements.

Impossible-Stock-758

Could you elaborate and explain the relevant tax rules for each part please? Do you mean basically take advantage of friends or families unused CGT allowance?

chef_26

Option one is sell an amount that wouldn’t trigger a CGT event. Assuming that you need a certain amount and therefore this isn’t a option, have you accounted that your contributions do not count towards CGT nor does the CGT allowance (I’m sure you have but worth the ask) Outside of these options others are correct, there is not much that can be done to minimise the burden. There are things that can be done to mitigate the tax due, SIPP, VCT etc but these shouldn’t be done just to recover tax paid in my view.

Chillers

Where I'm from this is classed as disposal and it a CGT event.

MachaMacMorrigan

The second shafting comes from the fact the asset has not actually appreciated on value. Using gold, rather than Bitcoin (because gold stabilized in value over 2000 years ago). And a house rather than Bitcoin, because housing is not in a price discovery phase, like Bitcoin (where price is volatile). My folks bought a house 50 years ago for the fiat equivalent of 260 oz of gold. Today, that house is worth 260 oz of gold. There has not been any actual increase in value. But the fiat price has gone up by a factor of 2 to the 5 (doubling every decade). Purchasing power has gone down by the same amount. CGT is payable on the difference between the purchase price and the sale price in fiat, *with no allowance for currency debasement between the two dates* So, say purchase was 100K, sale after 20 years was 400K. CGT is payable on the 300K difference **even though 100K then = 400K now**. The Government treats the 300K as ***profits*** even though it's nothing of the sort. It is simply a reflection of *money printer go brrr*. At the end of the day, you are poorer by 300K * CGT rate. Interesting historical note: In the time of Emperor Augustus, a centurion got paid about 40 oz of gold a year. An army captain today is also in charge of about a hundred men, and his pay translates to about . . . 40 ounces of gold a year.

BrickSufficient6938

You're grand no need to apologise, I was in panic myself being in EU. However in practice there's no change other than when moving from KYCed account to non-kyced they might ask you to confirm recipient acc belongs to you. Mapping out my web i guess, not great for privacy but in my case not a concern. Also it's worth noticing: other than money laundering rules there's a lot of different laws within the EU. Some will tax it at 40% even more, some just don't tax any CGT whatsoever. Planning retirement accordingly 😉

coconutboi

I don’t understand where you get shafted twice here. On sale of btc, CGT is applied - that makes sense. But aren’t you protected from the debasement of fiat by holding bitcoin? So you avoid the second shafting, no?

modenamagic

Ok this question comes up a lot. Here is my understanding in UK Capital gains laws. 1. Get a loan where BTC is collateral. What I read (happy to told I am wrong, if you hand over your Bitcoin into a pool then you are in effect selling and CGT kicks in. If you instead still have ‘control’ over the BTC and a company is just ‘holding’ it then it does not. Happy for feedback. 2. If you pay the loan with BTC you trigger CGT because you are liquidising to pay a loan in effect but if you pay with FIAT you don’t. Happy for feedback!

blue419

Yea, that could work. I think over time, it will become legal tender in enough places to no longer be subject to CGT.

MachaMacMorrigan

> When enough politicians start holding their wealth in Bitcoin, they will soon make it tax-exempt. Politicians hate paying tax. Excellent point. Don't have to make it "tax-exempt". Just note that BTC is legal tender in several countries (at some point in the future) and therefore it's a currency (technically a CFTC regulated financial instrument) . . . and CGT does not apply to FX transactions.

devhaugh

None. CGT is annoying but I'm not moving my life away. It's 33% in my country, let's say I moved somewhere with 20%, is it worth up ending my life for that. Not a hope.

mr_sarve

AFAIK CGT is 22% in Norway as an individual

theeggflipper

In Australia, CGT is 50% discounted to 25% if you hold for 12 months on money I’ve already paid income tax on the money I invest. Absolute scumbag parasites

Few_Ad6516

38% CGT including crypto plus 1.1% annual wealth tax on your global assets. Income tax around 40% for high earners. Plus price of living is high and quality of life is low compared to similar countries.

-Blue_Bull-

What? No you don't. Register as a crypto asset trader with HMRC and you pay income tax, no CGT. You only pay CGT if you don't register as a trading company. You can do this on a self employed / sole trader basis as well.

Hitchie_Rawtin

It's 33% in Ireland, I already know two people who've moved to Portugal to take advantage of their long term CGT (0%).

MachaMacMorrigan

Tax implications? You pay tax on Yen? Euros? Any other FX currency? Nah, the whole notion of BTC as a *commodity* is so that The State can double whammy you via CGT, on (a) selling your personal property and (b) from the money debasement that occurs over the period you hold the 'property'. [Consider that a house is likely the same price today *in ounces of gold* that you paid for it. Sell it, and you're liable for CGT in the inflated fiat currency of the land. You just got shafted. Twice. No lube.]

slvbtc

The point of this thread was CGT is unjust and I stand by that. The enemy is not eachother the enemy is inflation and money printing. Its sad you cant see that.

slvbtc

Indexing CGT to CPI is a joke anyway. CGT should be indexed to the actual money supply increase.

slvbtc

CGT is unjust, the more the government debases the currency the more an asset rises denominated in that currency, so your asset can rise at the same rate as the currency is debasing meaning you have zero net gain yet you still get taxed CGT. That is double taxation, they are taxing you through debasement and taxing you on the dollar denomination of the asset. It should be illegal. Move to a country that doesnt have CGT!

Odd_Monk_132

If your country allows you to do that yes, but make sure you know the laws. For instance in the UK there's a 5 year clawback period. If you move to Germany for 1 year and pay 0 CGT, when you move back, you will owe HMRC the CGT.

jig-jig-jigger

You pay CGT on money too… coins and stamps are chargeable assets for CGT

medialAxis

In the UK it's classified as an asset, a digital asset, and so subject to CGT, as you say. What's your argument against that classification?

Hitchie_Rawtin

Nah, CGT exists: first guy pays on a 2k gain which is going to have 666 taken by the government in my country (Ireland) so guy one has 19334, guy two has a 19k gain so he's left with 13730. Makes a fuckton of difference.

organisednoise

Yeah yeah yeah. We all know Australia’s CGT is bs.

Artorias_the_hollow

Do you live in the UK or elsewhere? If you are British but have lived outside the UK for 5+ years then you don’t pay any CGT.

t_valberg

Im broke lol, if you say so 😂 I'm just moving across the globe to avoid CGT LOL

Full_Ad2934

Oh STFU, you’re clueless. Plus, your broke ass doesn’t have to worry about CGT with your $34 gain. Regard.

mutinomonem

The other thing is that you can actually buy things with bitcoin. In 2017 card manufacturers were snapping our hands off to enable bitcoin payments with them. This all fell away when IMF demanded that all nations treat bitcoin with CGT. It's not a technical limitation with bitcoin it's a political one.

Full_Ad2934

Most other countries have CGT, you regard.

Odd_Monk_132

Read above, the person sold to buy back, but they also have to pay the CGT bill on the profits.

TheThirdHippo

My advice to you would be - What happens if BTC bombs, you get scammed, it’s only worth ~$250k. Yes it would be nice to be worth the $1.2m you need for mortgage + CGT, but don’t count on it saving your ass.

Mountain-Awareness13

It’s not 100% liquid, you pay CGT whenever you convert, you pay exorbitant fees to buy/sell and transactions are not instant. There are flaws with it. I own it purely because it can’t be inflated.

phaattiee

I don't even know what you're trying to say but I'll try!? No because as of right now its not legal tender, yes its a peer to peer transaction so technically you can purchase something with it if the recipient is willing to receive BTC in exchange... You would have to research bartering laws in that case. At least in the UK jut about everything is considered an asset that isn't pound sterling... And if you're selling something for more than its worth then you have to pay your dues... "give unto Caesar..." as it goes. If you're selling BTC back into FIAT you're technically going against what BTC was created for... The tax part has nothing to do with it. If you were using BTC the way it was designed to be used you wouldn't ever trade it back into FIAT so you wouldn't have to pay TAX. Now the problem comes (at least in the UK) when you convert BTC into another asset class... Capital gains applies whenever you convert any kind of asset into another, its classed as a "disposal of the asset". So for example if you bought a house for 300k worth of BTC which you bought for 50K you would have to pay the CGT on the 250k IN CASH FIAT. Governments have made it difficult for BTC to function in that way. IDK that's the best I can do.

6_25bitcoin

You are arguing with people who know what they are talking about. All you did now was triggered 2 CGT events from converting from Bitcoin to USTD and then to USD.

pg3crypto

I think quite the opposite. When a country decides to allow regular foreigners to open a bank account and cash out into it tax free without a minimum balance, we'll see a 180 by the US government. The problem with the taxation systems in a lot of countries is not paying the tax, I think most people would be fine paying CGT...it's the declaration requirements...you not only have to declare what you liquidated and where it came from, in a lot of places you have to declare how much of it you still hold...that's where the problem lies. If governments allowed people to declare CGT with no strings, they'd make a hell of a lot more tax receipts...because they wouldn't be treating people like criminals by default. A lot of countries seem to treat CGT as kind of a "wealth control" mechanism...it's not about collecting taxes, it's about controlling who can be wealthy. It's a sniff test to protect existing elites. Look at the UK, gradually decreasing the CGT allowance from £12k down to £3k...that has absolutely no impact on wealthy people...it only hurts those at the bottom of the ladder and makes it a lot harder to climb up.

cl3ft

Australia is the same. Tax treatment is different if you're a hobbyist/investor vs a registered trader/miner. Specifically CGT discounts and the tax year you can write off losses and what you can write them off against.

jsh63

The seller is exempting himself from CGT... make him give $42K of BTC, he will still be better off

cl3ft

I wasn't recommending USD as an alternative store of wealth. It's lost 80% of its value in 47 years. But property is like Bitcoin. Limited supply. Shares are measured in USD but a broad based ETF will generally hold its value against dollar printing. Both are more stable as a store of value than Bitcoin. I could be wrong, but I can't see how this wouldn't be the case. I'm Not running my business if buying materials for Bitcoin ends up costing me money. Because my 20% margin realised in 3 months is completely swallowed and then some by Bitcoins price increase over that time period. I'm just saving as much Bitcoin as possible because it's the only rational economic move. So if Bitcoin was the global currency its value would go exponential in short order, companies would lose money if they bought materials for manufacturing would cease and invest in Bitcoin as much as possible instead, cutting all staff. Capitalism would die and so would a LOT of people as everyone hoarded as much Bitcoin as possible. Poorer people would have no income to buy Bitcoin and almost everyone else would have to spend what Bitcoin they've got as the wealthy hoarded it. There would not be enough CGT to fund governments. Society would break down. Yeah, Bitcoin needs to be digital gold, not the reserve currency.

Maleficent-Tiger-412

Basically save money now, when everything starts to die down after fall bull run from the halving start looking for good projects that survived the bull run aka not shitcoins. Then about this time next year put the money you have been saving, (instead of gambling on shitcoins all year) into those projects. In the next bull run in the 2027 halving you will be set. Never buy the fomo bull run. Buy the bear when everyone forgets about crypto and take profits years later with no capital gains in the bull run. Sorry to say it’s too late to make serious gains and not pay CGT. Hold whatever you bought and save now so you can get a solid position on the next bull run.

tinytempo

Even with the current £6k CGT allowance (that will soon end)…?

string_beans

No, still have to pay CGT tax when transferring or paying for goods in the UK

Regular_Chapter_788

>If you buy the Bitcoin, then spend it immediately, there's no "gain", so it's not a taxable event. Yeah that's not how CGT works.

GiverTakerMaker

KYC 100% does matter. You will be sacrificing a huge chunk of your gains to corrupt taxes and corrupt governments. ​ Bisq, Robosats, use p2p face to face meetups with bitcoin groups. Some folks will sell you BTC for cash probably at a small premium. You can also try non KYC exchanges. You can buy USDT with a credit card at one place, then send those USDT to non-KYC exchanges - spread it around. Then convert USDT to BTC. Transfer that BTC to addresses of your own custody. You will pay a bit in fees for a few transactions, but that will be nothing compared to the potential CGT you will be ethically avoiding. It should be a moral imperative for good people to stop funding corrupt governments.

optitmus

doesnt this essentially mean you can circumnavigate CGT since you can just spend any gains you make before it ever hits your bank acc

GiverTakerMaker

I guess I should text while waiting in traffic. ... the point still stands. They take .25btc from you for nothing. Rinse and repeat you end up with nothing. Here in Australia they are talking about trying to introduce unrealised CGT. Forcing you to sell you paper gains.

Silver-Rub-5059

User name checks out 😂 33% CGT where I live. Can’t be dealing with that.

SendMe143

>You sell for 50k profit going to be roughly 50k CGT No country has a 100% rate 🤣

Jermaine119

Thanks, yeah that was my point but I can see what you mean about the missing details. That’s the reason why I just don’t think there’s any point in selling atm, surely we can say Bitcoin has peaked when we’re able to buy without CGT being added?

only_merit

I can't agree more with you :-) Your OP is kind of missing these details that you've not explained, that you are thinking about future where CGT is removed from Bitcoin due to its increased adoption. Before 2030, it's very unlikely you'd see that in those big countries (even if they started to talk about that now, it will take them that long to make it happen). If you want to avoid CGT now, either make it illegally, or change jurisdiction.

only_merit

You are mixing two things. You are mixing how things should be, and there I rather agree with you, and how things actually are, and there you are wrong. In UK, when you sell, CGT applies. And yes, perhaps in some countries (I doubt UK, but who knows), maybe at some point in the future, someone changes the law and it will be more like it should be. But currently, it's not. These things take years, if not decades. Politicians are useless slow parasites and I would not put any hope into any one of them. Maybe, just maybe, in Argentina or El Salvador, maybe. But UK, US, CA, EU, AU? I would not hold my breath.

Jermaine119

You missed the point of my original post. As the price goes up Bitcoin *should* more likely to be accepted as a payment currency. You don’t pay CGT on a payment of a house. Do you? So Bitcoin theoretically shouldn’t be different.

Jermaine119

CGT works when you sell to make a realised gain. Not when you spend it.

GiverTakerMaker

You are right. It is stupid. Just to explain how absurd the legacy financial system is with all its unfair taxes that the rich are able to avoid. Suppose you had 1btc @50k. It gow to 100k. You sell for 50k profit going to be roughly 50k CGT with many tax authorities gouging for 50% CGT rates on crypto. You buy back in. Now you only have 0.5btc... rinse and repeat. You end up with nothing and the gov gets everything. The moral of the story... don't sell. Don't use kyc bitcoin Don't pay corrupt taxes to corrupt governments.

crypto_paul

Depending on where you live, this seems unlikely unless bitcoin is treated the same as cash for tax purposes at some point. Who wants to have to record every transaction they make and report it for CGT?

Raj_UK

Guessing / not financial advice, that they OP will have to eat the CGT for cashing out and give the remaining fiat to their family member as a gift ? Fair thing would be for the family member to accept the "loss" of the CGT and not expect the OP to pay it for them and get the "full" fiat amount of their crypto

Raj_UK

Guess it depends on the geo of the OP and their family member Assuming they're not in the Cayman Islands with their 0% CGT for example LOL

Raj_UK

But he's not swapping or trading it if he moves to another wallet ? So if it was BTC he just sends BTC to his family member, and then they perform the taxable event when they cash out to fiat ? Or is there no outcome that doesn't generate a CGT crystallization event for the OP ? If so, can't they just factor that in to the amount of fiat they give their family member after paying all the CGT themselves ?

LeahBrahms

Do you have any CGT losses declared to ATO previously from 2022 losses? Probably time to go to an Australian exchange anyway if you need to exit it.

MachaMacMorrigan

Some real estate companies now accept BTC. No conversion via fiat required. You could also arrange barter directly with the property owner. There's also the option of a collateralized loan using your BTC. Not sure where CGT comes into it.

Evillian151

Yeah you should check than with the Belgian tax authority ofcourse, but if you don't use the bitcoin you won't pay capital gains tax to begin with? And i thought belgium has something like "Prudent Investments" if you don't do risky things like lending money to buy bitcoin, speculate or trade with it professionaly you don't pay tax? >Belgium's Capital Gains Tax Exemption >Generally, capital gains realized by a private individual are not subject to tax, provided such gains: >Fall within the scope of "normal management" of personal assets >In broad terms, "normal management" means managing a private asset by taking actions a "prudent man" would typically carry out to maximize the asset's value. >Such assets generally mean movable goods, immovable property, and portfolio values acquired through personal savings, inheritance, as a gift, or from the reinvestment of alienated property. >Of course, the definition of "normal" vs. "abnormal" or speculative isn't always so cut-and-dry, so CGT may still apply in some cases.

Ok-Anything4091

It's great that you're asking these questions, and it's important to understand the tax implications of buying and selling Bitcoin in South Africa. Here's some general information, but keep in mind that tax laws can vary, and it's always a good idea to consult with a tax professional for personalized advice. In South Africa, the South African Revenue Service (SARS) has provided guidance on the tax treatment of cryptocurrencies like Bitcoin. Here are some key points to consider: 1. **Capital Gains Tax (CGT):** * In South Africa, profits made from the sale of cryptocurrencies such as Bitcoin are generally subject to Capital Gains Tax (CGT). * CGT is calculated on the profit you make when you sell or dispose of your Bitcoin. This profit is the difference between the selling price and the "base cost" of the Bitcoin (usually the price at which you acquired it). 2. **Reporting Requirements:** * It is your responsibility to keep records of your cryptocurrency transactions, including purchases, sales, exchanges, and any associated costs (like transaction fees). * You are required to report your cryptocurrency gains or losses on your annual tax return to SARS. 3. **Banks and Large Transactions:** * Banks in South Africa are required to comply with anti-money laundering (AML) regulations, which may involve reporting large transactions to regulatory authorities. * If you transfer a significant amount of money from a cryptocurrency exchange to your bank account, the bank may flag this transaction. This is not necessarily for tax purposes but for regulatory compliance. * However, the bank will not automatically assume that the transfer is related to cryptocurrency. You will still need to report your cryptocurrency gains or losses to SARS as per tax regulations. 4. **Tax on Cryptocurrency Gains:** * When you sell Bitcoin and realize a profit, this profit is subject to CGT. * The CGT rate in South Africa for individuals is based on your income tax bracket, ranging from 18% to 45%. * You are allowed to deduct certain expenses related to the acquisition or disposal of your cryptocurrency, which can reduce your taxable capital gains. 5. **Keeping Records:** * It is crucial to keep detailed records of all your cryptocurrency transactions, including dates, amounts, prices, and any fees paid. * Proper record-keeping will help you accurately calculate your gains or losses for tax purposes and provide evidence in case of an audit. 6. **Tax Consulting:** * Given the complexities of cryptocurrency taxation, especially for larger sums, it is highly recommended to consult with a tax professional or accountant familiar with cryptocurrency taxation in South Africa. * They can help you understand your tax obligations, optimize your tax position, and ensure compliance with tax laws.

HelpMePls___

If OP lives in germany its tax free, UK would be subject to CGT which would be 40% on a value of 600k, but based on the use of $ im guessing USA

Adev22

Enjoy your CGT Return and buy-back at a nominally different price

gowithflow192

Your math is correct. One downside of a wealth tax is profit and loss don't matter. So in a bear market you still pay (albeit lower) taxes whereas in other countries with CGT the losses actually reduce your tax bill or can even be carried forward. Also apparently the wealth tax is not compatible with EU law. Residents continue to pay it but there could be some kind of retrospective action in future (government is undecided at present) which sounds like a huge mess on the cards. I cannot see how they can practically retrospectively apply a new law.

Lurking-Good-Tonight

Also I read on the gov website that If your taxable income and your taxable capital gain added together is less than £37,700, you'll pay basic-rate CGT (10% on most investments, 18% on second homes), I assume this applies to crypto too?

only_merit

> Is it possible to spend bitcoin without paying tax ? yes > isn’t any spend considered a taxable event on which I possibly need to pay CGT ? in some jurisdictions, yes > Am I getting this right ? hard to say, you did not say much

Amber_Sam

>Really - what country is that? I didn’t know anyone didn’t tax gains. My guess is Germany. Austria possibly too. In Portugal, people don't pay capital gain on Bitcoin, unless it's their only income. Singapore, UAE, many small Caribbean nations have zero CGT.

VeryThicknLong

Can you gift someone to increase your CGT?

MachaMacMorrigan

I thought CGT taxable events happened when someone sold BTC for fiat? I was referring to *barter* of BTC (legally defined as a property asset) for another property asset, such as a house. Your point about Lightning is well made. Bring on the circular economy.

MachaMacMorrigan

It makes sense to cash in your GBTC and buy real BTC if you plan on HODLing for 10+ years (and GBTC returns = real BTC returns over that period). Put it another way: 1.5% fee for 10 years is 16%, and for most peeps in the US, CGT is 15%. Better for long-term investors to take the hit now. Plus there's no risk of a 6102 event.

Beautiful-Bake-8799

Not in Australia, CGT on every. fkn. trade. And they don’t allow ACB in tax. You have to choose LIFO or FIFO in your first fiscal year of trading and you’re stuck with that for life.