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VAT treatment of cryptocurrencies

Adrian
  • Updated

This article is intended for members in the United Kingdom. If you're looking for instructions for CoinJar Australia, visit this article.


CoinJar

When you buy and sell cryptocurrency within CoinJar or CoinJar Exchange, you are trading directly with CoinJar as principal. CoinJar quotes an exchange rate and is buying/selling cryptocurrency from/to you in its own capacity.

HM Revenue and Customs (HMRC) outlined its provisional VAT treatment in 2014 pending further developments. For VAT purposes, cryptocurrencies are treated as follows:

  • when cryptocurrency is exchanged for Sterling or for foreign currencies, such as Euros or Dollars, no VAT will be due on the value of the cryptocurrencies themselves.
  • charges (in whatever form) made over and above the value of the cryptocurrency for arranging or carrying out any transactions in cryptocurrency will be exempt from VAT under Article 135(1)(d) of the EU VAT Directive.

As such, VAT does not apply to buy/sell transactions within CoinJar or CoinJar Exchange.

 

Further information

In general, CoinJar is unable to offer tax advice. Please reach out to a tax professional for further assistance. 

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