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Staking UK Crypto Tax Disposal – Worked Example of DeFi Taxes



HMRC is KILLING De-fi and staking! They are enforcing more rules and regulations and it is making staking your income difficult with tax rules and restrictions

These rules now introduce a new crypto tax chargeable disposal and these lead to the disposal of capital gains for tax purposes. With this change has been confusion and opposition from the crypto community to remove this change but for now, the new staking taxes stand.

Lets look at a worked example of uk crypto tax on staking and how the new tax disposal can lead you to pay more capital gains taxes but also to pay less taxes in certain situations

Be sure to check out these recent videos of mine to learn more about the world of tax:

https://www.youtube.com/playlist?list=PLhpPDH1pmPV4XI25PcD2ewqUvxWQqlQnH

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Using my knowledge and practical experience I will provide you guidance to learn more about some of the key areas of tax and what they may mean for you. If you do have any specific comments or questions about tax that you would like me to cover in videos, be sure to add them to the comments section and I will respond. If you are new around here, please be sure to hit like and subscribe for more tax information and education to support you in understanding where your hard earned money is going!

Please note that these videos and comments are for eduction and entertainment purposes only. All information that I provide is believed to be correct but please be aware that there may be inaccuracies.

#taxation #learnabouttax #financialeducation

What do you think?

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10 Comments

  1. Hey mate was thinking about using autostake in the future, with auto stake on pancake swap that generates yield daily do you have to pay tax on the funds that isn’t claimed and just re staked automatically?

  2. My biggest issue with all the tax stuff is organisation. How do i keep track of so many transactions, different deployments of tokens, staking here – staking there. How do i keep track of it all chronologically whilst trying my best to seperate my different crypto activities (defi vs investment in various other things with simpler tax requirements). I will need spreadsheets pointing to spreadsheets etc. I guess i need to set up a bunch of wallets with different purposes. Anyway thanks for the videos.. I'm glad you're making these. I would love to see some animations over these – it would make the points a lot more digestible.✌️

  3. thanks for the video.

    I have a rewards plan of ehich i get daily rewards that I brought with USDT and the rewards given are not a currency of any kind as they are just their own made up point rewards system. but they can be exchanged for a currency called MOF (molecular Future)

    am I correct in thinking that at the point I exchange them for the MOF they then become subject to Income tax and then capital gains tax when I exchange them for another token (back to usdt) ?

    any feedback would be appreciated 👍

  4. I use koinly, and log all defi staking as sending to and from POOL on their software – this files it as me in control of the assets still – would this be ok?

    is it even worth staking in UK now unless stable coins?

    Would i be right in thinking if you stake your crypto as soon as you buy it, so that the value is the same , there would be no gains to pay tax on? However, when (say in 2 years) you unstake it , would this be a taxable event treating the whole sum as an airdrop? and then you would pay tax again on this to convert into FIAT?

  5. The rule assumes you sell the tokens, which is total bs, but again, but it can be argued in court that beneficial ownership is not transferred in some defi cases. But my having to recalculate all 700tx for defi is BS. HMRC screwed up and they need to fix it asap before all crypto holders (who can and have major holdings) leave UK for good.

  6. So, unless you are making loads by staking, the reporting nightmare will cost more in stress, record keeping time & Accountancy fees 😭🙈 (many APIs/CSV files are inaccurate…. eg Bitrue …. just thinking about PP events recording makes me feel sick 🤦‍♀️).
    Knowing my luck, I'll pull my few quid out of all staking before 6th April, then in July it will be " you know those Guidelines, well, we've changed our minds". I'll be as sick as a parrot 😡.
    How to kill DeFi in one document 😭

  7. What period does this updated guidance/rule change apply to? For example, if you started dabbling in DeFi in 2021, do you have to retrospectively pay tax on the applicable tax year? Or do you only need to start worrying about this from April 2022 onwards?

    Also, where you get revenue from on-going DeFi stakes (share of fees, yield farming etc.), if this is seen as taxable income rather than CGT, is there an AEA or similar threshold for that too? Or if you're already a taxpayer with a regular job, it just gets added to whatever bracket you're in and you pay tax on the first pound of additional income according to that bracket (assuming it doesn't push you into a higher bracket)? Thanks

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