UK plans digital wallets tax grab

Taxpayers must now declare digital cash in their tax returns, adding electronic assets to their official documents.

The UK’s HM Revenue and Customs (HMRC) plans to introduce rules that could see cryptocurrencies seized from businesses that fail to pay their taxes.

In a bid to crack down on tax dodgers, the UK government is reportedly initiating proposals to give tax agencies access to online wallets to modernize how tax is collected in the digital age.

Cryptocurrencies will be added to self-assessment tax returns, resulting in an additional tens of millions of pounds a year in capital gains taxes on profits that are not currently reported.

“The proposals will help ensure HMRC’s debt collection keeps pace with business practices. E-commerce means new business practices with fewer physical and owned assets held in the UK, which makes it harder for HMRC to collect unpaid taxes using existing powers.

“All of HMRC’s powers are balanced by safeguards, which should reassure taxpayers that powers are exercised proportionately and consistently,” said a HMRC spokesman.

Under “direct recovery of debts” powers, the HMRC already holds the means to retain funds from bank accounts when individuals fail to pay taxes.

However, the new proposal considers the possibility of extending this to online payment accounts, such as PayPal.

“If further regulation is brought in around digital currencies, it may be that cryptocurrency wallets could become a more popular method of paying for goods and services,” said a HMRC consultation document.

Although the the UK government is reportedly expected to follow through with granting the HMRC the power to seize funds from digital wallets, it is unclear, as yet, if this will extend to cryptocurrencies.

Looking for your next crypto casino? Check out: Mega Dice or FortuneJack

Written by Isabella Aslam

Reporter

Isabella is an experienced writer in B2B and B2C journalism. Alongside crypto, Isabella writes and discusses the topics of relationships and psychology. Isabella holds a first-class degree in music journalism and often interviews electronic artists and DJs.

Similar News