UK Enforces Crypto Tax Break for Foreigners Using Local Brokers

The U.K. is enforcing a tax exemption for foreign investors purchasing crypto through local investment managers or brokers starting Sunday.

The tax break, announced in December, is a part of Prime Minister Rishi Sunak’s plans to turn the U.K. into a crypto hub.

“This exemption is an important factor in attracting global investors, meaning foreign investors won’t be brought into U.K. tax simply by appointing U.K.-based investment managers,” the government’s tax arm, the HM Revenue and Customs, said in an email to CoinDesk. “To build upon the U.K.’s position as an investment management hub, this exemption has been extended to include crypto assets, so that funds which include them aren’t put off from appointing U.K. managers.”

The country already has a tax guide for resident crypto traders. In July, the HM Revenue and Customs published a consultation to gather views from investors and professionals on how it should tax decentralized finance (DeFi).

Parliament is debating the wide ranging Financial Services and Markets Bill that would give local financial regulators more powers over crypto if passed into law. The U.K. Treasury also plans to kick-start a consultation in the coming weeks on how the crypto sector can be regulated.

Read more: UK Crypto Tax Guide 2022