Greetings,
I have spent the entirety of today combing carefully through every single crypto transaction that I've made. Yes, very boring and grown up thing to do, but with the UK government apparently aggressively going after crypto people, I thought I should make sure all my affairs are in order.
The 31st of January deadline for paying taxes has been extended to February 20th due to delays caused by COVID-19
Something I quickly realised while analysing all my transactions is that I have had no actual capital gains in the past tax year. Indeed, most people haven't. I talk about why in this video.
I'm not a tax expert or financial adviser. Please seek proper advise.
Peace & Love,
Adé
▶️ DTube
Are you declaring all your dividends from all your tokens as income? Cause I have to haha. It's why I've gotten rid of most of my layer 2 tokens.
Crap! I forgot SteemHunt!
I think the Australian law is probably a little harsher than here. Here it's all capital gains, except you have to do something (like offer a service) to receive them. There's also no tax event until you sell them. So I just let them sit there untouched. It's nuts.
Man, living the dream :(
Hi Ade. Good to see you!
Lucky you if it only took a day! I'm assuming from that you didn't tackle your blogging and curating income from Steemit etc?
I've been working on getting my records 100% in order, including blogging and gaming income, so it's easier from this point forward, but it's taking me forever.
Were you able to discover the amount you got in the Hive airdrop? I haven't been able to find a record of it so am having to extrapolate. 😁
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Hey! Long time!
It did take ALL day though, using software as well. The Steem/Hive stuff is a grey area here in the UK. You have the rewards that are "income" since you have to "do something" to receive them. Then you have the interest on the staked Steem. It's both capital gains and income compounded into one. However as long as you didn't sell the Steem in that tax year (which I didn't), I can worry about it in the following year. I hope the law will be more clear then.
The only useful tool I used that can make it easier is steemworld.org
Yup, that one was easy. I was quite involved in the hostile Steem takeover resistance so I took a lot of screenshots at the time :)
I hope the government realises that treating proof-of-stake crypto like stocks and property will ruin this space and send more people unto the unemployment register.
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I forgot to mention.
Unless you've made more than £12,500 in gains (not total), then you don't have to worry anyway. As for blogging income, you have to have made more than £1,000 in trading income (including non crypto stuff like Adsense) for you to worry.
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I'm not worried about owing any tax right now but I want my records in order going forward. The income I earned from Steem wasn't enough to pay tax on for 18-19 but I haven't finished caculating for 19-20 yet as I have to add my Splinterlands income into that. It all has to go in the CG pot regardless.
I used some of that Steem to buy DEC or packs in Splinterlands which are all taxable events for CGT.
Without software I'd have had no chance of working it all out. Even with it it's taking a very long time.
It's not the tax calculations themselves so much as finding the historical records that takes the time.
I haven't even started on Hive yet although that should be more straight forward.
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We definitely need a talented developer to write an app that can do this for us. Exchanges have APIs for synching to tax software that basically just suck up all the transaction ID's along with the price data at the time. I'd be willing to pay for that service :)
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I'm sure it will come as more and more people stop burying their heads in the sand re. taxes.
I found an old one for Steem which someone in another discord edited for me so it worked better. Then my son cleaned out all the thousands of jasons he could find that related to the mechanics of Splinterlands rather than the finance. I used that as my basis.
As I said I haven't started on Hive yet but that will be mostly Splinterlands stuff again. Although, I'm not sure how accessible the historical data from that will be. I've kept some records but not complete ones.
I just want to get my records to a "good enough" state so I can keep them properly going forward.
It was pretty depressing to see all the BTC I'd exchanged for Steem back in the day. 😂
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Hahaha. yea. I saw one of such depressing transactions myself. 0.9xxx BTC to Steem 😫
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OMG. That's terrible. Mine were more like 0.008 but there were quite a few of them. Then I switched to using LTC to buy Steem. 😂
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Can you really deduce capital losses from author and curation rewards on Steem and Hive? Aren't the latter earned income as opposed to capital gains?
I don't know anything about how the UK taxes this sort of income but here airdrops are considered capital gains with the purchasing price being zero when sold, which means that when you sell, you have to pay capital gains tax on the entire sum you get when you sell. For that reason, receiving an airdrop is no tax event by itself.
No, they're seen as income, but you have to sell them to fiat for them to trigger a tax event. There's also a grey area with Steem/Hive. Since they're not tips like BAT or LBC tokens, they're based on stake, which makes them like interest. There is no clear guidance yet on how to deal with that. I'm going for the easier option of seeing them as stake based interest.
Airdrops are the same here. They're seen as zero cost capital as long as you don't have to offer any services for them.
Hardforks like Hive are seen as a doubling of your capital, with the same cost basis. So you can either split the cost across the two chains (Steem and Hive for instance), or keep the costs on one chain (Steem) and treat Hive as zero cost.
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