I am wondering how the tax would be calculated on p2p BTC trading.
Let’s say Jack has a Revolut and Coinbase account. He has 10 friends who are not knowledgeable on the whole concepts of cryptocurrencies but would like to have some BTC in their digital wallet. Jack offers them to transfer GBP to his Revolut account and in return, send them the equivalent BTC subtracted by let’s say 2% commission. Behind the scene, Jack transfer GBP from his Revolut to his Coinbase account and purchase the equivalent BTC and instantly send the 98% of the purchased BTC to his friend’s digital wallet.
Clearly the gain is equivalent to 2% of the incoming funds. However, here are my questions:
- Does Jack need to have a tax report on his Coinbase account?
- Does Jack need to register as a business? Or apply for any kind of certificate HMRC-AML, FCA, …? Is there a limit to consider this as personal trading not a business?
- Are there any limits to such certificates? For example, I know that if the turnover is higher than 85K, VAT is needed. What other limits do we have?