Aave deposit - UK

Hi,

I was wondering if depositing on Aave in the UK is a taxable event? I was under the impression that it was since you give ETH and get back aETH. Not sure I would define it as a disposal though since you don’t actually lose possession of the tokens themselves.

Any knowledge or info on this would be great.

Thanks

Hi David,

Most countries do not have any specific guidelines on specific Defi activities like this.
Most of our users choose to treat these as non-taxable events since you are basically just depositing ETH into a vault and receiving aETH as a placeholder (like a receipt). You can then claim your ETH back later.

Due to the lack of guidelines, it’s difficult to say for sure how tax agencies around the world want these to be treated so you will need to consult a professional or use your best judgment.

Best regards,
Petur