Making a killing on NFTs?Posted 2022 by Jane L
That’s great news for you, but now the taxman is interested too.
Crypto and DeFi investors are increasingly investing in Non-Fungible Tokens or NFTs, having started the trend now being promoted by sports stars and A listers.
As a consequence, we are seeing increasing numbers of clients who have traded in NFTs and are now concerned about being under HMRC’s spotlight.
Whether you are a serious NFT speculator or a dabbler in fun art such as Bored Apes or CryptoKitty, here are a few things that you need to do.
- Ensure that you keep detailed records of all your NFT trading transactions which should include:
a. Transaction date
b. Item traded
c. Cost price and selling price
d. Quantities sold
- Be prepared to share this information with HMRC even if you don’t think that you are liable for UK tax on your NFT trading
- Calculate your tax liability and ensure that you use these personal tax allowances efficiently.
If you find the tax situation daunting, you should take advice from a specialist crypto tax accountant who knows UK tax law and obligations.
Our team not only work with crypto clients regularly, but several of them also hold crypto and so you can be sure that they really do understand your requirements.
Need more advice on Crypto / NFT tax from a Crypto specialist accountant?
We have a lot of information about the UK tax situation for Crypto and NFT on our website which you may want to read before getting in touch.
- Crypto tax FAQ
- Business start-ups in the cryptosphere
- Should I incorporate my crypto trading activities?
- Tax implications of earning in crypto
- Crypto Day Trading and Tax
- NFTs – the importance of planning
- Crypto Tax specialist services
- DAO – Digital Autonomous Organisations
- Ask our UK based crypto accountants for crypto tax advice