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Transfer Bitcoin ownership to a Limit Company

Will I be liable for CGT on Cryptocurrency transferred to my limited company

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My family and I have a limit company for the purpose of family wealth management.  The shareholders are all family members and the company mostly holds investment property.

I have some Bitcoin which I aquired many years ago at a cost of next to nothing.  I'd like to transfer Bitcoin to the company so that the company now owns it (thus avoid inheritance tax hopefully in the very distant future).

I will not be receiving anything in return for the Bitcoin; it will just become company owned and benefit all the shareholders equally.

So my questions are:

1) What value will I give to the Bitcoin on the company balance sheet?  Should be it be fair market value at the time I transferred it to the company?  Or my initial base cost?

2) If the book value is the current fair market value then would this generate a CGT bill for me?  (Same as if I had sold them for cash?)

3) What happens if the company sells the Bitcoin at some point in the future; how is the CGT for the company calculated at that time?

4) Is the company under any obligation to write-up or write-down the value of the Bitcoin on the balance sheet to reflect changes in the market value?

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By paul.benny
12th Jan 2021 13:10

If you have wealth sufficient to require management, you can presumably afford to pay for professional advice.

I would not recommend relying on internet advice from people, however expert they may be but who do not have the full facts of the case.

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Replying to paul.benny:
Psycho
By Wilson Philips
12th Jan 2021 13:40

I would also expect that someone in this position has heard of the marvellous new facility known as "Google".

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Replying to Wilson Philips:
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By Tax Dragon
12th Jan 2021 13:52

I'd wager you half a bitcoin that someone armed with Google (other engines are available) coupled with the level of tax knowledge on display here would not get the tax analysis complete and correct.

And I'm not a betting dragon, as you know. (In the gambling sense.)

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Replying to Tax Dragon:
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By bernard michael
13th Jan 2021 09:40

Quote:

I'd wager you half a bitcoin that someone armed with Google (other engines are available) coupled with the level of tax knowledge on display here would not get the tax analysis complete and correct.

And I'm not a betting dragon, as you know. (In the gambling sense.)

That's who's replaced MDTP while the pubs are closed

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By Duggimon
12th Jan 2021 13:44

Bitcoin are assets, sale of assets to your own company is (nearly) always at market value, CGT is payable on the uplift in value, companies don't pay CGT and I would expect a company to hold an easily measurable asset at market value in its accounts.

There are too many caveats to all of the above to list them all but I would suggest if your holding in bitcoins is more than half a bitcoin you really ought to seek proper paid for advice, and make sure it's from someone who knows a bit about bitcoins. I've dealt with a couple of people investing in them in the past and it can get enormously complicated.

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By carnmores
12th Jan 2021 14:36

You bet

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