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Posted Wed, 23 Aug 2023 01:36:21 GMT by
Hello there, I've been working as a freelancer in web development since 2010 and have been self-employed. I'm also the owner of a couple of companies, one in the US and another in the UK. Recently, I started a new UK-based company, although it hasn't generated any income yet. My situation involves a few unique aspects, and despite searching online, I couldn't find answers to my specific case. I'm hoping you can provide some clarification on the following scenarios: Dealing with cryptocurrency in Pakistan is quite complex due to limited local banking options for activities like buying and selling. Given that I receive my payments in USD and GBP through platforms like Payoneer and Wise.com because of my online work, I maintain foreign currency accounts there. I've been actively investing in and trading cryptocurrency, primarily on exchanges like Binance and Kraken. Here's where my query comes in: My brother resides in the UK and earns a good income through his job, although he isn't well-versed in the realm of cryptocurrencies. Recently, he expressed interest in investing in crypto and asked for my guidance on purchasing and related processes. We decided that I would manage both his and my investments combined on platforms like Binance, with the profits being withdrawn to his local UK bank account. He could then send my portion of the investment and profits back to me by converting GBP to USDT and transferring it to my wallet. I'm really keen to understand: Is this arrangement permissible? Specifically, is it okay for me to send him GBP from my Payoneer/Wise accounts so he can deposit it onto an exchange, purchase USDT, and forward the USDT to me for trading in cryptocurrencies like BTC/ETH? Since I'll be withdrawing GBP to his local bank account (including the funds he'll send me after converting my earned GBP into USDT on an exchange), is he solely responsible for tax on his initial investment? Or would he also be liable for taxes on my investment and subsequent profits? If any of these practices potentially violate UK laws, I'm eager to learn about the recommended approach for him to engage in such a business venture with me, given that I'm not a resident of the UK. Thank you very much for your assistance. Your insights are greatly appreciated. Kind regards,
Posted Wed, 30 Aug 2023 10:32:10 GMT by HMRC Admin 25 Response
Hi Laava x
The arrangement is a personal choice and not for HMRC to comment on.
We are unable to comment on scenarios whether they are hypothetical or real.
You may therefore want to engage the services of a financial adviser.
Thank you. 

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