The Royal Tax and Customs Service of the United Kingdom (HMRC) requires cryptocurrency exchanges to provide customer data and transaction history in order to identify tax evaders.
According to unnamed sources, over the past couple of weeks, letters with requests for customer lists and transaction information were sent to at least three exchanges doing business in the UK – Coinbase, eToro and CEX.IO.
“HMRC is committed to working with exchanges when it comes to finding information about people who buy and sell crypto assets. I think they are interested in information about transactions over the past couple of years, ” said one of the industry representatives.
The source also noted that it would be difficult for any platform to provide information for ten years. He added:
“If the tax authorities can get information for the last couple of years, I think that people who came to the industry at its dawn in 2012-2013 will not be affected. Those who have achieved the greatest success will not be persecuted by the tax service – those who came to the market at the peak of its popularity will face it.”
HMRC said it did not disclose the details of its information requirements, as this could jeopardize the assessment or collection of taxes. However, the agency confirmed that such requirements are within its competence, stating:
“Exchanges can store information about their customers and the transactions they have made. These transactions can lead to potential tax charges, and HMRC has the right to issue notices requiring exchanges to provide this information.”
It should be noted that recently the Brazilian Tax Service obliged citizens to report cryptocurrency transactions, and the US Tax Service (IRS) sent letters to cryptocurrency investors demanding to provide information about their income received from transactions with cryptocurrencies.
However, in many countries, the issue of taxation of crypto assets is still open. At the end of last month, the Association of Lawyers of Russia only discussed the taxation of cryptocurrencies