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Posted Mon, 15 Apr 2024 14:09:27 GMT by Fraser Scott
Hello If a cryptocurrency company has an SEC case ruled against them for securities laws violations and compensation is paid out to purchasers of the tokens then is it taxable and if so should it be declared as Miscellaneous Income or as a Capital Gain on the tokens? If it's a Capital Gain and the investor gets to keep the tokens then would they just use a cost basis of zero? A compensation payment is made up of a Total Loss Amount component and an Interest component, the latter dating from when the tokens were first purchased. Would these two components be treated differently? An example of one such case is Veritaseum : but there will likely be numerous others to follow. Thank you.
Posted Wed, 17 Apr 2024 12:11:13 GMT by Fraser Scott
Hello Could HMRC please give guidance on this as it is difficult to find any conclusive information elsewhere. One suggestion has been to treat the Total Loss Amount component of the compensation as a Capital Gain with zero cost basis, and the Interest component as Miscellaneous Income. Would that be the correct thing to do? Thank you
Posted Thu, 25 Apr 2024 10:09:01 GMT by HMRC Admin 25
Hi Fraser Scott,
The is not suitable for this forum.
You may wish to call HMRC on the Agent Dedicated Line (ADL) if you are calling for a client.
Or contact HMRC on 0300 200 3310
Contact HMRC
Alternatively you can send in full details in writing.
Thank You

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