Many considerations for business start-ups are the same, whether the business is started up and run in the crypto sphere under DeFi, traditional Centralised Finance, or a hybrid.
Before kick-starting your crypto business, consider the following, all of which we can support you with:
- Taking business advice – to maximise your chance of success
- Business structure which may include company incorporation
- Business plans, forecasts and cashflow
- Funding requirements
- VAT registration and advice
- How to minimise direct taxation
- Method of payment of goods, services and wages – in crypto or traditional currencies?
- What expenses can be claimed against tax
- Business or private vehicles
- Record keeping, including crypto and tax software
- Other related issues such as legal requirements, pensions, insurances etc
Do you really have to pay tax on a crypto business?
Whether you operate a business wholly or partly in the crypto sphere, your venture must still be legal and tax compliant. The penalty for non-compliancy or tax evasion can be high; HMRC has access to an increasing amount of information and is pursuing non-payers.
Because this is a new area, HMRC have only issued limited guidance, so to determine the tax position for any crypto related businesses we must refer back to traditional tax rules and apply these accordingly.
However, because crypto is not recognized as a currency for tax purposes it is not always easy to know which rules to apply. That is why you need to use a specialist crypto accountant.
Get in touch with us – we have specialists in crypto taxation, business advisory and tax compliancy, so we can help you to stay on the right side of the law. It’s better to start off correctly than try to clear up the mess later.
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.