Founder & Director
Andy is an experienced tax adviser and a Barrister after being called to the bar in October 2019. Andy’s clients extend across all types of sectors, he has a...
The advent of smart contracts and non-fungible tokens have taken the world of cryptocurrency in new (and for many, unexpected) directions. Even HMRC’s newly revised guidance on crypto assets does not even touch on these subjects. Nevertheless, there is rising interest in investing in NFT’s and ‘play-to-earn’ gaming. Not surprising when NFT artworks sell for up to US$69 million and players of blockchain games are earning enough to retire from their day jobs.
With substantial earnings, it is inevitable that HMRC will soon turn its attention to the taxation of them.
Unfortunately for HMRC, NFT’s and blockchain gaming don’t necessarily sit well with HMRC’s established understanding as set out in the revised guidance.
Whether you are an established NFT investor or artist, or just venturing out into this new environment, or you have already earned substantial sums with your CryptoKitties or about to start playing Axie Infinity or The Six Dragons and have big plans, ETC Tax can help.
Members of our team not only invest in cryptocurrencies but are also involved in NFT’s and blockchain games themselves. We know the space from direct experience.
Understanding the correct tax treatment of your profits requires a good understanding of the underlying technology and the transactions involved. But that is only the beginning.
ETC Tax will also understand you and not only will we get your tax return right, we will also help you to plan all of your tax matters, so your NFT or blockchain portfolio works together with your plans for now and the future and alongside your other income and assets.
He invested small sums which grew over the years, boosted by a couple of lucky wins with crypto-based gambling platforms. That was only the beginning for him because he then stumbled across MegaCryptoPolis and invested much of his gains in that new game. Now he generates regular and substantial sums, developing virtual plots of land in that virtual city, producing virtual assets and selling them to other players for Ethereum. We helped Mr. T by scrutinising all the different transactions involved in the game to ascertain the correct way of reporting his profits to HMRC. Then we looked at his current position, to help him efficiently restructure his gaming activities to be more tax efficient moving forward, dovetailing that with his real-world business profits, his retirement planning and his inheritance planning.
He developed his own code and deployed that on the game’s smart contract to take advantage of an in-built incentive incorporated into the smart contract by the game developers. We researched the underlying technology and transactions, recognising that Mr. D was not merely a player or investor in CryptoKitties. We researched the underlying technology and transactions, recognising that Mr. D was not merely a player or investor in CryptoKitties. We helped Mr. D to explore the badges of trade and the case law around the definition of gambling to present his filing position to HMRC. We then helped him to work out the most effective way to reinvest his gains in a tax efficient way. We then helped him to work out the most effective way to reinvest his gains in a tax efficient way.
Call or email us any time or, simply fill out the contact form below and a member of our team will be in touch.