UK Releases Bitcoin (BTC), Cryptocurrencies and Staking Guidelines

HMRCS has published guidance for the first time explaining how stacking is handled for the purposes of taxation. It had previously been assumed that the stake process was under the mining roof, and for this reason two different events were collected in a single guide.

Her Majesty's Revenue and Customs (HMRC) has updated its guidance on the taxation of crypto assets, including stake.

It was the first guidance from HMRC to describe how stacking is handled, for the purposes of taxation. Previously, the staking process had been evaluated under the mining roof.

The published guidance on staking is almost identical to the statements on mining. However, the introduction of separate guidance for the two may open the door to differentiation in the future. In a statement, a spokesman for HMRC said::

“The guidance demonstrates our commitment to providing clarity to our customers. It will help individuals and businesses understand the tax consequences of different types of transactions in crypto assets.”

Taxation of staking activities by businesses will depend on whether the activities are a “taxable trade,” according to the newly drafted guidance.