Can a company contract a bitcoin loan?

HMRC does not consider crypto as money and the loan relationship does not apply.

Didn't find your answer?

Hello,

In their Dec 2019 guidance, HMRC says that cryptocurrency is not a form of money therefore the loan relationship rules do not apply.

Does this only mean that the charges and credit rules governed by the loan relationship rules such as interest do not apply?

What happens in practice if a shareholder loans the company 1 bitcoin with no interest and the company repays 1 bitcoin to the shareholder the next year? Are there any taxes due to fluctuation of the price of bitcoin between the moment the loan was contracted and was repaid?

Replies (43)

Please login or register to join the discussion.

paddle steamer
By DJKL
11th Feb 2021 13:47

How does it fit within say FRS102 rules (or others) re valuation/profit recognition within the company's financial instruments? It is surely a measurement issue as the company does not report in Bitcoin, so loan to company:

Dr Asset- 1 Bitcoin
Cr Creditor -A value ascribed to 1 Bitcoin whatever that is.

You then surely have the issue of recognition of the value of 1 Bitcoin in the accounts and the derecognition when it is returned to the individual if the agreement is written in such a way that 1 bitcoin is what is to be returned

https://www.frc.org.uk/getattachment/69f7d814-c806-4ccc-b451-aba50d6e8de...(March-2018).pdf

Thanks (1)
Replying to DJKL:
avatar
By drtoctoc
11th Feb 2021 14:19

I'm not sure I understand. If the company has a bitcoin in its account, and it owes one bitcoin, then as the value of bitcoin fluctuate, the sum of the value of its borrowed bitcoin and debt is zero.

What would happen if the company was borrowing gold for example? Could maybe the loan be construed in a manner that the company only has custody of the asset?

Thanks (0)
Replying to drtoctoc:
paddle steamer
By DJKL
11th Feb 2021 15:44

The company has an asset and a liability, what you need to consider is how it requires to reflect each, how it has to value each within its financial statements, the asset and the contractual liabilty (however that is expressed). The accounting valuation approach may well not be the same on each side, to check you need to look at the relevant accounting standard that the company uses.

Thanks (0)
Replying to DJKL:
avatar
By Paul Crowley
11th Feb 2021 16:08

I think OP has it right
If the debt is one bitcoin

Thanks (0)
Replying to Paul Crowley:
paddle steamer
By DJKL
11th Feb 2021 16:34

Each side of the balance sheet surely needs valued within the accounts at each year end, is the basis of valuation that will be required to be made the same re both the asset and liability, per the reporting standard being adopted, is the key question?

Here are some PWC comments re IFRS and crypto currencies, I note they possibly do not consider them financial assets though just skim read

https://www.pwc.com/gx/en/audit-services/ifrs/publications/ifrs-16/crypt...

Thanks (0)
Replying to drtoctoc:
avatar
By Paul Crowley
11th Feb 2021 16:09

So what exactly is the point of the excercise
By your logic
Company never makes a gain or a loss

Has a bitcoin, owes a bitcoin

Just like it never really happened, which sounds a bit true to life

Thanks (0)
Replying to Paul Crowley:
avatar
By drtoctoc
11th Feb 2021 16:19

The point is to provide capital to the company without generating a taxable event.

If the shareholder sells his bitcoin, provides a loan denominated in pounds to the company which then buy a bitcoin, waits a year, sells it and repays the loan, that create two potentially taxable events.

Thanks (0)
Replying to drtoctoc:
avatar
By Paul Crowley
11th Feb 2021 16:28

So It intends to spend the bitcoin?

Thanks (0)
Replying to drtoctoc:
avatar
By Paul Crowley
11th Feb 2021 17:09

This is going way over my head

How does the company have capital?
it starts with zero
it adds a thing, deducts a thing, and ends up with zero

Thanks (1)
Replying to Paul Crowley:
avatar
By drtoctoc
11th Feb 2021 17:52

Yes, you are right, it's not capital. I meant to say, let the company have assets, that it could trade to generate profit, but that ultimately need to be returned.

Thanks (0)
Replying to drtoctoc:
avatar
By Paul Crowley
11th Feb 2021 19:39

But to trade with that asset it needs to sell the bitcoin.
I accept the esoteric interest but not the practicality

Thanks (0)
Replying to Paul Crowley:
avatar
By drtoctoc
11th Feb 2021 20:59

The company is in the business of trading cryptocurrency for profits. Instead of the shareholder having to sell his bitcoin and incur a capital gain tax, he loans the bitcoin to the company who then trades the bitcoin for other cryptocurrencies until it realises a profit. Ultimately, it returns the bitcoin to the owner.

The point of this is that the shareholder doesn't incur a capital gain tax by selling a bitcoin.

Thanks (0)
Replying to drtoctoc:
avatar
By Paul Crowley
11th Feb 2021 21:17

without that comment the question is meaningless

Time for me to head oud out the door.

Thanks (1)
Replying to Paul Crowley:
avatar
By paul.benny
12th Feb 2021 07:38

+1. It would have made much more sense if the OP had volunteered this fundamental context at the start.

I'm also out.

Thanks (0)
Replying to drtoctoc:
paddle steamer
By DJKL
11th Feb 2021 22:44

Duplicate

Thanks (0)
Replying to drtoctoc:
paddle steamer
By DJKL
11th Feb 2021 22:43

It surely returns "A" bitcoin not "The" bitcoin, "The" bitcoin surely got sold after it was lent to the company.

I am not convinced you can say the original owner does not dispose of his bitcoin, how does he "lend" it without disposing of it, if the company does not "own" it, have some form of title to it to get monies for it, how do they sell it to raise any funds to invest, how do they trade it?

Thanks (0)
Replying to DJKL:
avatar
By Bobbo
12th Feb 2021 11:12

Is this not basically how 'short selling' works?

Company B borrows 1 share of X plc from Company A sells it, hopes price falls, buys back 1 share in X plc and returns that to Company A.

Though i dare say short selling is somewhat more regulated than the scenario OP is proposing.

Thanks (0)
Replying to Bobbo:
paddle steamer
By DJKL
12th Feb 2021 11:39

"When a security is loaned, the title and the ownership are also transferred to the borrower. "

https://www.investopedia.com/terms/s/securitieslending.asp

If the loan is considered similar to the above the title and ownership of the security change so the original owner has disposed of the Bitcoin triggering a tax liability.

These may be of interest:

https://www.gov.uk/government/publications/tax-on-cryptoassets

Thanks (0)
Replying to DJKL:
paddle steamer
By DJKL
12th Feb 2021 11:51

Would TCGA92/S263B apply, would Bitcoin fall within the categories where such transactions are not disposals for CGT purposes?

https://www.legislation.gov.uk/ukpga/1992/12/section/263B

I suspect not, as the definition of securities at 263AA is

In section 263A and this section “securities” means—
(a)shares in a company wherever resident,
(b)loan stock or other securities of—
(i)the government of the United Kingdom,
(ii)a local authority in the United Kingdom,
(iii)another public authority in the United Kingdom,
(iv)a company resident in the United Kingdom or other body resident in the United Kingdom, or
(c)shares, loan stock, stock or other securities issued by—
(i)a government, local authority or other public authority of a territory outside the United Kingdom, or
(ii)another body of persons not resident in the United Kingdom.]

Accordingly to me the lending of the Bitcoin looks to be a disposal for the purpose of CGT and tax will arise upon the lender at that point.

Thanks (1)
Replying to DJKL:
avatar
By alexwt
24th Apr 2021 01:31

I looked at this and I disagree.

Cash (or cash equivalent, e.g. stablecoins) loans backed by crypto collateral (the likes offered by Celsius, Nexo, BlockFi, etc) fall under S263A/TCGA92. Crypto loans between two parties fall under S263B/TCGA92.

Crypto must slot into whatever legislation is closest since there is no crypto specific legislation. Crypto here plays the role of a debt instrument, which fits the bill for the purpose of S263B and S263A as they apply to crypto. See CFM74140 for stock loans that cover this crypto loans case: https://www.gov.uk/hmrc-internal-manuals/corporate-finance-manual/cfm74140

As such, the initial and final transfer of the crypto are not subject to CGT.

If the borrower disposes of the crypto while in interim ownership then gains may arise and the cost used to compute gains is that of the crypto used to repay the loan as described in CFM74150. This part is less clear, since that cost depends on the cost basis when the loan was received by the borrower - which I assume to be the market value on the day (else the borrower should borrow cash instead and buy the crypto off the market).

Tax liability of the crypto remains with the lender, i.e. cost does not change for the lender and the lender would incur CGT if later disposes of the crypto after the loan is returned, i.e. as if the loan never happened.

Thanks (0)
Replying to DJKL:
avatar
By alexwt
24th Apr 2021 02:04

I looked at this and I disagree, should not be subject to CGT. I explained in a reply below:

https://www.accountingweb.co.uk/any-answers/can-a-company-contract-a-bit...

You did spot S263B which applies (as does S263A for crypto-backed loans, also not subject to CGT in general)

Thanks (0)
Replying to DJKL:
avatar
By drtoctoc
12th Feb 2021 21:57

The original owner loans the bitcoin by sending it from an cryptocurrency exchange account owned by him to a cryptocurrency exchange account owned by the company.

Once the bitcoin is on the company's account, the company can trade it or do whatever it wants with it.

Thanks (0)
Replying to drtoctoc:
paddle steamer
By DJKL
12th Feb 2021 22:50

Well, that seems to be a taxable point for the lender unless you can find a relieving provision,I can't, so you appear to trigger a liability to any latent CGT within the Bitcoin when control and benefit of the Bitcoin pass to the company.

Thanks (1)
Replying to DJKL:
avatar
By drtoctoc
13th Feb 2021 15:02

Thank you, that was pretty much what I was looking for.

I presume one way to not trigger CGT would be for the shareholder to enter into a loan relationship with the company where bitcoin is the collateral. The company would lend him a small sum and his bitcoin would be sent to the company as a collateral. HMRC refers to such an arrangement here https://www.gov.uk/government/publications/tax-on-cryptoassets/cryptoass...

I'm actually quite surprised by the tax treatment reserved to such a transaction. That would mean that, to take something that has been around for thousands of year, if the company was to contract a loan of a gold bullion for the shareholder, he would have to declare gains on it as well.

Thanks (0)
Replying to drtoctoc:
paddle steamer
By DJKL
13th Feb 2021 15:37

Re your first point the funds are surely going the wrong way compared with your original proposed transaction, there you wanted the company to use the bitcoin to itself trade here you are proposed some form of security is held over the bitcoin securing the loan from company to individual, Of course such a loan of cash from company brings all sorts of BIK issues and S455 issues.

In such an instance I am not sure the bitcoin has been disposed off, but it also has not become a company asset, when I grant a security over my house to my lender my lender does not have the asset, my house, as his property, he does not include it on his balance sheet, he can merely force sale for my non performance of the loan but his interest in the proceeds of such a sale are his loan sum, the interest and appropriate costs, if he sells for more the excess is returned to me, the owner of the property.

Thanks (1)
Replying to DJKL:
avatar
By drtoctoc
13th Feb 2021 16:26

You are correct that the transaction seems to be going the wrong way. Instead of the company borrowing a bitcoin from the shareholder, it looks like the shareholder borrowed money from the company and gave it bitcoin as collateral; in practice, the situation is similar. If the bitcoin is worth £30,000 and the company loans the shareholder a much smaller amount, say, £5,000, then S455 isn't triggered.

In this case, if the loan term is one-year, would the company be allowed to use the collateral, 1 bitcoin, by trading it against other assets, and after one year, return the bitcoin to the shareholder?

Thanks (0)
Replying to drtoctoc:
paddle steamer
By DJKL
13th Feb 2021 21:07

Why is s455 not triggered if there is security for the loan? You are not giving the company the asset you are merely offering it as security, nothing more.

No, security is merely a call on the asset in the event of default, Nat West don't phone up asking to stay in my house although they still hold a security over it.

Thanks (1)
Replying to DJKL:
avatar
By drtoctoc
13th Feb 2021 21:45

Thank you, that is very helpful!

I thought s455 was only triggered for loans of £10k or more. Am I wrong?

I agree with your second point but thought that that applies for the house because it's a non-fungible asset. If I loan someone gold or a security, I wouldn't care about getting back the exact same asset since they're fungible.

Thanks (0)
Replying to drtoctoc:
Stepurhan
By stepurhan
15th Feb 2021 10:12

Benefit in Kind is only triggered for loans over £10k

s455 starts immediately.

Thanks (1)
avatar
By Paul Crowley
11th Feb 2021 13:58

What happens if bitcoin goes down?

Thanks (0)
Replying to Paul Crowley:
paddle steamer
By DJKL
11th Feb 2021 14:12

I guess you value each year and book profits and losses through the accounts, but have not really looked at it particularly re Bitcoin as think the whole array of such "currencies" are flawed investments, certainly I would never buy any of them.

Thanks (0)
avatar
By paul.benny
11th Feb 2021 15:07

Suppose I purchase 1 bitcoin and lend it to my company, which it then converts to GBP. Sometime later, the company repays me by buying a bitcoin, which I then sell. If bitcoin has increased in value, the company gets tax relief on the difference and I've extracted 'tax-free' cash from my company, less dealing costs.

Is that what you were thinking of?

Thanks (0)
Replying to paul.benny:
avatar
By Paul Crowley
11th Feb 2021 16:12

But why does company buy a second bitcoin?
Just gives back the data thing it 'borrowed'

Thanks (0)
Replying to paul.benny:
avatar
By drtoctoc
11th Feb 2021 17:59

No, it's not.

In your case, the company makes no profit and you incur a capital gain tax. Because you loaned a bitcoin, received the bitcoin back but then sold it a profit.

I'm not trying to find a loophole or anything, I just want to know if I could loan the company a bitcoin the same way I could loan it cash.

Thanks (0)
paddle steamer
By DJKL
11th Feb 2021 16:57

A shorter article (albeit US facing) indicating they likely need held as intangibles. Still not found anything re how treated as a liability yet.

https://www.forbes.com/sites/shehanchandrasekera/2020/05/21/how-are-cryp...

Thanks (1)
avatar
By SXGuy
11th Feb 2021 18:04

I was thinking about this only the other day. Whether a company could own bitcoin as an asset and what happens to it should the value increase or decrease.

We can take the view that if the company held the bitcoin as an asset then the value of it should be reevaluated at year end, and a loss or gain reported.

What I'm unsure of is how you can loan a bitcoin to a company or indeed anyone for that matter.

In order to receive money one first has to supply the money.

With bitcoin you'd need to transfer it to the companies bitcoin wallet.

At which point the company own the bitcoin, there's no mechanism in which you can force a repayment of bitcoin, other than maybe its monetary value id have thought.

Whether you owe the value at transfer or whether you also owe any gains or losses at time of repayment probably comes down to the loan agreement.

And also the lender may have a cgt charge on any gains? No idea.

There's also transfer fees so who pays that?

Its mot something id personally want to make a mistake with.

Thanks (0)
Replying to SXGuy:
avatar
By Paul Crowley
11th Feb 2021 20:15

Agree all
Bitcoin is financial black magic, as there is, as far as I am aware, no tax law or tribunal decision from which to advise: any decision made on consequences are a stab at guesswork on reasonableness

Having said that
@OP it is not illegal to do what you suggest, as clearly the company can do anything that is not illegal or in contravention of the company rules (articles and memorandum and possibly members written agreement)

Just cannot figure out any benefit to anybody of the transaction

Thanks (0)
avatar
By richard thomas
12th Feb 2021 17:49

Since there is no money debt, there is no loan relationship and nothing that can be treated as interest unless this can be classed as a murabaha transaction within s 503 CTA 2009 or a structured finance arrangement within s 758 CTA 2010, though both seem a tad unlikely.

This is because in substance it's a form of repo involving an intangible asset (in legal and, depending on the accounting, tax terms). Depending on the accounting any profit or loss arising from the resale is probably within Part 8 CTA 2009 as a non-trading debit or credit.

I really don't see the point of the transaction. The shareholder will have a CGT gain or loss on disposal at MV to the company (assuming control) so a loss will be clogged. The company will have a NG/NL transaction under Part 8 and then possibly a gain or loss under Part 8 on transfer back to the shareholder at MV.

Why doesn't the shareholder sell the bitcoin and lend the proceeds to the company?

Thanks (0)
Replying to richard thomas:
avatar
By drtoctoc
12th Feb 2021 21:51

The point of the transaction would have been for the shareholder not to incur capital gain tax upon lending the bitcoin.

If lending a bitcoin to a company counts a disposal, then the transaction would be similar to the shareholder selling the bitcoin then lending the proceeds to the company.

Thanks (0)
Replying to richard thomas:
avatar
By alexwt
24th Apr 2021 02:01

Lending bitcoin is (generally) not subject to CGT, i.ve explained more here https://www.accountingweb.co.uk/any-answers/can-a-company-contract-a-bit...

Thanks (0)
avatar
By alexwt
24th Apr 2021 02:07

I looked at this (*), should not be subject to CGT.

Cash (or cash equivalent, e.g. stablecoins) loans backed by crypto collateral (the likes offered by Celsius, Nexo, BlockFi, etc) fall under S263A/TCGA92. Crypto loans between two parties (OP's case) fall under S263B/TCGA92.

Crypto must slot into whatever legislation is closest since there is no crypto specific legislation. Crypto here plays the role of debt instrument, which fits the bill for the purpose of S263A and S263B, and as such the initial and final transfer of the crypto are not subject to CGT - provided borrower returns same crypto type, same quantity, etc. Fungibility of crypto allows an easy interswap with shares for tax treatment interpretation in this case; HMRC does treat crypto as shares in some cases, even though not explicitly, as property in others, and even as money or money-worth in others ... whole thing is still a mess in the UK taxation wise (not crypto's fault)

CFM74140 (which further sends to S263B) applies to this case of crypto loans: https://www.gov.uk/hmrc-internal-manuals/corporate-finance-manual/cfm74140

If the borrower disposes of the crypto while in interim ownership then gains may arise and the cost used to compute gains is that of the crypto used to repay the loan as described in CFM74150: https://www.gov.uk/hmrc-internal-manuals/corporate-finance-manual/cfm74150. This part is less clear to me, since that cost depends on the cost basis when the loan was received by the borrower, which I assume to be the market value on the day (else the borrower should borrow cash instead and buy the crypto off the market).

Tax liability of the crypto remains with the lender, i.e. cost does not change for the lender and the lender would incur CGT if later disposes of the crypto after the loan is returned, i.e. as if the loan never happened.

(*) I looked at this for loans between two individuals, but I don't see why it would be different between an individual and a company. Sure, the latter would imply some other aspects for the company, but are separate (the borrowed crypto isn't owned by the company so not on balance sheets etc)

Thanks (0)
Replying to alexwt:
avatar
By alexwt
24th Apr 2021 03:27

Also, I forgot to mention that HMRC responded to clarify that the initial and final transfers of crypto in the case of loans with crypto collateral (S263A) are not disposals for CGT purposes:

https://community.hmrc.gov.uk/forums/customerforums/sa/3cf8f511-077d-eb1...

It's a disposal only if borrower defaults.

S263A and S263B share the same fundamentals regarding initial and final transfer of crypto.

This reply fro HMRC also shows that "securities" in the context of S26 include crypto, as expected. Someone above was saying differently, and I can see why non-crypto savvy accountants can get it wrong: HMRC itself makes implicit interpretations seemingly at odds with current legislation, because simply it has no choice: since they refused to write new legislation for crypto, failing to interpret flexibly and put various different hats on crypto behavior depending on context (shares, property, securities, etc, even money) would otherwise implies it couldn't tax it in some cases.

.. and there are still a pretty great number of gray areas when it comes to crypto taxation in the UK. It's a guessing game as to how HMRC might interpret it, and even then it's not guaranteed HMRC has the "correct" interpretation (HMRC has been taken to court by experienced tax advisors and lost on many occasions even when legislation was clearer than it is for crypto).

Thanks (0)
avatar
By richard thomas
24th Apr 2021 12:01

This is my single response to the four postings by alexwt in the wee small hours.

02:04 posting

I take this first because it is a response to an earlier post by DJKL, who might be forgiven for now feeling somewhat patronised. “Clever you for finding s 263B all on your own” is the implication of your reply.

02:01 posting

This was a lead in to your 02:07 post in which you seek to explain why lending crypto is not (generally) subject to CGT.

You first state, with no qualification, that s 263A does apply to repos where crypto is the “security” and that s 263B does apply to lending of crypto. That is a bold thing to state when it is crystal clear that crypto is not a “security” within the s 263AA definition.

You next offer an explanation of why you think it does so fall or rather it reads like an assertion that it should do. By what canons of interpretation of statute is something required to slot in to whatever legislation is “closest” and who says what is “closest”? It seems to me that the normal rules of CGT are “closer” to crypto than s 263AA.

Nor do I understand why you think fungibility means that crypto is a security. Bank notes are fungible but not securities, while many securities are not fungible (for example if the transaction involves the entirety of the issue of the security).

Next, what is your authority for saying that HMRC treats shares as crypto in “some circumstances”. What circumstances? And where is the evidence for HMRC’s treatment?

The only publicly available information about HMRC’s views is in “Cryptoassets: Tax for business” (updated 20/12/19). There is nothing there about crypto as the subject of a loan or as collateral other than:
“Loans backed by exchange tokens as securities/collateral
If exchange tokens have been provided as collateral security for an ordinary loan (of money), a loan relationship exists and the loan relationship rules will apply (whether the company is the debtor or creditor).
Loans of exchange tokens
If exchange tokens are loaned - as opposed to traditional currency - it is unlikely that this would constitute a loan relationship. In particular, given that the tokens would not represent an amount of money or currency:
• there would not be a money debt
• there would not have been a transaction for the lending of money”

Nothing in this deals with the CGT ot CTG treatment of the cryptoasset.

The passages about Stamp Duty/SDRT are more specific:

“Transfer of exchange tokens

For the transfers of exchange tokens to fall within the scope of Stamp Duty or Stamp Duty Reserve Tax, they would need to meet the definition of ‘stock or marketable securities’ or ‘chargeable securities’ respectively.

This will be considered on a case-by-case basis, dependent on the characteristics and nature of the cryptoasset, rather than any labels attached to them.

However, as of the original date of publication of this paper, HMRC’s view is that existing exchange tokens would not be likely to meet the definition of ‘stock or marketable securities’ or ‘chargeable securities’.”

The passage about pooling for the purposes of CGT is also helpful:

“Pooling provides for simpler tax calculations which apply to shares and securities of companies and also any other assets ‘where they are of a nature to be dealt in without identifying the particular assets disposed of or acquired’ (section 104 of the Taxation of Chargeable Gains Act 1992). HMRC believes exchange tokens fall within this description, meaning they must be pooled.”

Thus HMRC do not regard cryptoassets as “shares or securities”, but something else (that being the closest fit).

Even if HMRC had made an unpublished concession that they would be treated as securities for the purposes of s 263A and s 263B that could not be relied on to stand up in court, nor can HMRC be relied on to abide by their own publications and non-published statements in litigation.

It is whistling in the wind to say that the paragraphs of CFM you quote help you. They do not mention crypto, so you are saying the because you thick they are like securities as defined in s 263AA they can be so treated for CGT purposes.

Finally you say you have considered the position between two individuals, and there is no reason why the position should not be the same where there is a transaction with a company.

Assume that s 263A applies (which I deny) in a case where the individual makes an in-substance secured loan to a company. The problem there is that s 263A would not apply to the company’s transfer back on the repurchase, because s 263A does not apply for the purposes of CTG (see s 263A(6) and the tailpiece of s 26). The equivalent for CTG is paragraphs 6 and 11 Schedule 13 FA 2007 which applies in the same way as s 263A and uses the same definition of securities but is limited to cases where the transaction is accounted for as a loan.

Or assume 263B applies (which I deny) in a case where the individual lends the crypto to a company. The position of companies is less clearcut as there is no equivalent to s 263A(6). But s 263B(2) applies for “the purposes of capital gains tax”. I doubt whether this means also for the purposes of CTG as they are treated as two separate taxes (s 2F TCGA). Section 2D(3) makes it clear that CTA 2009 has priority if applicable. Here it will have, if the crypto falls within Part 8 CTA 2009 (intangible fixed assets).

Going back to your third paragraph you say “Crypto here plays the role of debt instrument, which fits the bill for the purpose of S263A and S263B”. Firstly crypto only plays the roles of debt instrument in s 263B cases: in s 263A cases it is the collateral. Second, it might play the “role” of a debt instrument but that doesn’t make it a security for s 263B purposes, or a loan relationship in the case of a company (see the HMRC publication I have quoted from above).

03:27 post

What an anonymous representative of HMRC said in the matter you linked to is obviously not authoritative in any sense. But you have misinterpreted it. The response was about s 26 TCGA (as you say) but the term “securities” does not appear in it. The relevant term is “by way of security” which is not the same thing at all. The subject matter of s 26 is “an asset or an interest or right in or over it”. The asset could be anything that might be given as collateral, induing crypto. Section 26 may well apply to the transfer of crypto in a repo case, but s 263A doesn’t.

I don’t think either that you are being fair to HMRC. The paper I have quoted from seems to me the best that could be done. Tax law in general applies to crypto as it does to any other asset.

Thanks (2)