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Italian Regulator Blocks Six Financial Services Websites

Italian regulator CONSOB blocks six financial services websites. Since July, the number of unauthorized trading websites blocked under orders issued by CONSOB has risen to 77, the regulator said today.

11 November 2019, AtoZMarkets – The Commissione Nazionale per le Società e la Borsa (CONSOB), the Italian Financial regulator, has published on its website a statement ordering the closure of six sites. That illegally offers financial services.

Italian Regulator Block Financial Service Websites

The six entities are:

  • Lion Finance Ltd (https://cfd2fxpro.com),
  • Globalix Ltd (www.globalix.co),
  • UAB Elnira (https://alltrademarkets.com),
  • Grandtrade.exchange (https://grandtrade.exchange)
  • BTB Corporate LT (https://bcapitalprofit.com)
  • Selinusinvestment.com (www.selinusinvestment.com)

In July of this year, CONSOB acquired the power to order Internet connectivity service providers. The power is to prevent access from Italy to websites. For which financial services are offered without appropriate authorization.

The obscuring activities of the sites by internet connectivity providers operating on the Italian market are ongoing. For technical reasons, the real blackout may take a few days, according to the statement.

Read More: Former ECB Chief Claims Bitcoin is Not Real

Already blocked 77 sites

Since acquiring these powers earlier in the year, the Italian regulator has ordered the blocking of 77 sites in the country. In today’s warning entities, already three websites seem not to work, or it cannot be accessed. Those are Globalix Ltd, Selinusinvestment.com and BTB Corporate LT.

The other three entities are Lion Finance, UAB Elnira, and Grandtrade.exchange. All seem to be Forex companies and other assets to be traded. The first on the list, Lion Finance, offers currencies, commodities, indices, stocks, cryptocurrencies, exchange-traded funds (ETFs), and futures. The company claims to provide technology for the trading industry.

UAB Elnira, on the other hand, claims through its website to offer customers the same services as brokers. But that is without the same level of fees. Besides, AllTradeMarkets is one of the few financial services providers in the industry. Also, its revenues come solely from the success of its customers.

The last entity, Grandtrade.exchange, declares that it is a dedicated forex trading platform. It also says that its headquartered is in Cyprus. But that has a global reach.

As AtoZMarkets pointed out earlier on 4 November, the Italian regulator was also ordering the blocking of six unauthorized Forex trading websites. These are TomCom Limited, Bonatech Ltd and Mitchell Group EOOD, Next Trade Ltd and TLC Consulting Ltd, Trader Platinum, London Capital Trade Ltd. However, online trading companies operate these websites. Furthermore, they don’t allow to offer their services to Italian investors.

Think we missed something? Let us know in the comment section below.

Is Forex trading illegal in India? Can Indians trade Forex Legally?

Being from India, I have always been interested in Forex trading. But it seems like international retail Forex Trading in India is illegal. So, I took the opportunity to investigate and find answers to if Indians can trade Forex legally?

I am not a legal expert, hence my answers in this short commentary is not written for lawyers. My research is not academic neither! I just want to understand why is Forex trading illegal in India.

Thus, this short research is based on a number of short talks with local experts. Additionally, I have read multiple rulings, the government regulation on ETF trading and Futures trading to find out whether or not Forex Trading can be legal in India.

Can you trade Forex in India?

Of course, you can trade Forex in India. In fact, Forex has become a daily routine of our lives. But if we are asking about retail forex trading in India, the answer is there are limitations.

You can trade Forex in India with Indian Exchanges (NSE, BSE, MCX-SX) which offers Forex Instruments. However, Indian Exchanges currently offer USDINR, GBPINR, JPYINR and EURINR pairs for trading purposes.

Trading non-INR Forex pairs is illegal in India under the FEMA act.

Forex Trading in India

Many international Forex brokers allow Indians opening accounts. Additionally, some of these brokers even try to have training academies in big Indian cities. However, if you are an Indian resident and wish to trade forex, you cannot trade all the trading instruments.

In short. global Forex market is not so global in India. It is true that the foreign exchange (forex) market is decentralized. Theoretically, you can freely buy one currency and sell another one to take advantage of the price movements. However, there are countries seeing this decentralized market as a sovereignty threat. Thus, due to sovereignty issues the Indian government has limited Forex trading in India.

Foreign exchange rules in India used to be even tougher in India a few years back. Now, RBI has slightly eased Forex trading rules. Since India is a net service exporting country, the country needs to ease Forex rules even further. But it is unlikely that we will have completely open financial markets anytime soon.

“Writing laws is easy, but governing is difficult.”

― Leo Tolstoy

So, the government has not forbidden Indians to trade Forex. They have limited trading for Indian residents to only trade currency pairs bench-marked against INR (Indian Rupee). As a an Indian resident, as long as you are trading through an Indian Brokerage, which allows access to Indian Exchanges such as the NSE, BSE, MCX-SX and providing access to currency derivatives is entirely legal. These tradable instruments are:

  • EURINR;
  • GBPINR;
  • JPYINR;
  • USDINR.

But, the Reserve Bank of India on the 10th of December 2015 allowed exchanges to offer cross-currency futures contracts and exchange-traded currency options in three more currency pairs. The RBI allowed exchanges to offer cross-currency futures contracts. The exchange-traded currency options in the pairs of EUR-USD, GBP-USD, and USD-JPY with immediate effect.

India Forex Reserves

So, why is India limiting Forex trading?

So, let’s study the logic behind the Reserve Bank of India (RBI). When you trade EURUSD  with “non-Indian” traders/brokers, if and when you lose you would buy USD from RBI. This results in an increase in the current account deficit (lack of foreign currency reserve). Essentially speaking, RBI is artificially claiming to keep Indian ForexReserves as their main priority.

India’s total foreign exchange (Forex) reserves stand at around US$442 billion as of the 1st of November 2019.

How to trade EURUSD legally in India?

Assuming that you want to trade EURUSD, USDJPY or EURJPY or other possible combinations, but your local exchange does not offer such an instrument.

In this case, you may trade USDINR and EURINR that the INR gets eliminated and technically end up trading USD vs EUR.  There is however a big disadvantage of trading Forex via crosses this way and it is the increase in transaction costs and there is often lack of liquidity.

Meanwhile, you should note that CFD platforms are not legal in India. Thus from a broader perspective trading on leverage is not allowed in India. You as a trader should know your limits and act accordingly.  So far, the government has not really cracked down on retail traders however there have been major crackdowns on a number of brokers illegally operating in India.

There has been regulated and unregulated brokers trying to establish their branches in India under different names, from education academies to training schools or consulting agencies. These entities often get away with their activities from a few months to a few years until someone gets to report them to the local authorities. Such as the xDirect Indian office raid earlier in 2016.

List of countries Forex trading is restricted 

List of Forex trading restricted countries are the following:

  • Belarus
  • Bosnia & Herzegovina
  • British Columbia (Canada)
  • Bulgaria
  • Burma
  • China (Strict regulations and event total ban)
  • Cuba
  • Indonesia
  • Ivory Coast
  • Iran
  • Liberia
  • Macedonia
  • Malaysia
  • Montenegro
  • Myanmar
  • Nigeria
  • North Korea
  • Pakistan
  • Quebec (Canada)
  • Romania
  • South Korea
  • Sri Lanka (Recently relaxed)
  • St. Helena
  • Sudan
  • Syria
  • Ukraine
  • Zimbabwe

 

India is not the only country to restrict Forex trading. Indeed, Forex trading is restricted in twenty countries globally. These countries promote propaganda to push their citizens away from Forex trading (online or offline). Often you’d see some of these countries painting the picture for the west as evil.

For India, trading on other pairs rather than defined by RBI is illegal under the FEMA Act. Trading forex in India through an online broker is a non-bailable offense in India. With many online brokers who misguide retail investors claiming forex trading performed legally through them. Moreover, RBI claims the restrictions are there to prevent retail investors/traders from losing big time. However, many India citizens believe that the main reason is to stop currency outflow. I meanwhile believe that RBI will ease in their limits in the coming period as India is going through the financial change.

Think we missed something? Let us know in the comments section below.

Russia Plans Legal Mechanism to Tackle Cryptocurrency Fraud

Russia plans a legal mechanism for the seizure and confiscation of cryptocurrency fraud. The Ministry of Internal Affairs of Russia will work with various state organs to draw up the plans. That could enter into law in 2021.

07 November 2019, AtoZMarkets – The Ministry of Internal Affairs and other departments will develop a legal mechanism for the seizure and confiscation of virtual assets. However, difficulties can arise not only with technical execution, but also with the uncertain status of such assets in Russia. So, to confiscate cryptocurrency, it must first be recognized at the legislative level.

Russia Cryptocurrency Legal Mechanism

In Russia, a legal mechanism may appear for the seizure of virtual assets and their subsequent confiscation. The Ministry of Internal Affairs, the Federal Service, the Prosecutor General’s Office, the Investigative Committee, the Ministry of Justice, the FSB, the Federal Customs Service and the Federal Bailiff Service with the participation of the Supreme Court should prepare their proposals on this matter by December 31, 2021.

First of all, cryptocurrencies are virtual assets, explained Nikita Kulikov. He is a member of the State Duma’s expert council. And he is also the founder of the PravoRobotov Autonomous Non-Commercial Organization. He believes that the usual practice of seizing property should be applied to digital money. But cryptocurrencies are now in the gray zone in Russia. And for confiscation, they must first be recognized at the legislative level as either a product or a cash equivalent, added Konstantin Golikov. He is co-owner and CEO of the Dailyrich.ru platform. He also believes that law enforcement agencies are launching the process of legalizing cryptocurrencies in Russia. Nevertheless, the Central Bank will resist that. Furthermore, in October, Binance launches Russian Ruble based trading options.

The resolution of the contradiction could be international agreements in the field of control over the circulation and issue of cryptocurrencies, said Dmitry Gorbunov. The determination of the legal status of virtual assets and common standards for procedures related to their circulation should be developed at the international level. Alena Zelenovskaya agrees with that. He is head of the criminal and administrative law practice at NSAA Amuleks.

Read More: Binary Options Scam Spreads Into Crypto World

FSB Could Seize Cryptocurrencies

According to the court, investigators of internal affairs departments, employees of the Investigative Committee, or the FSB could seize cryptocurrencies, Zelenovskaya said. But it can be difficult for authorities to gain access to the wallets that store virtual assets. The owner can hide or forget the password, Gorbunov noted. He added that the investigation would also need to prove that the wallet belongs to a specific person. Authorities may require the wallet keeper to block it. But only those sites that recognize the powers of Russian law enforcement authorities will enforce the decision.

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EU Plans to Block Launch of Facebook Libra Coin

EU plans to block Facebook Libra coins. EU is ready to prevent the development of risky digital currencies, including Libra. That is until all concerns have been addressed. The news is according to the latest proposal that will be considered by the finance ministers of the EU.

06 November 2019, AtoZMarketsFacebook is planning to launch a digital currency that has provoked a global reaction since its announcement last summer. On Friday, 8 November, EU finance ministers will discuss how best to address the myriad of challenges posed by this stablecoin. It is a digital token backed by sovereign currencies. Also, EU is Planing to launch public cryptocurrency.

EU Will Block Facebook Libra

The last draft text recalls the possibility of banning global stablecoins that create excessive risks. Member States state that all options should be on the table. That is also including the possibility of taking measures to prevent the development of projects. Those would create uncontrollable or excessive risks.

The previous version was vaguer. National governments were ready to take action to prevent global stablecoins from creating undue risk. The most recent text is in line with the original draft document prepared by the Finnish rotating presidency of the EU, which is already considering the possibility of taking measures. That would hinder the development of projects with uncontrollable risks.

The latest draft included a new paragraph saying that Libra and similar projects should not start operating in the EU. At least until all the challenges and risks have been identified and addressed. Friday’s debate is seen as a stepping stone to conclusions in December. But the lack of clear information on the Libra project hampers European progress.

Read More: Libra might launch series of Fiat Pegged Stablecoins

The Lack Of Clarity On The Facebook Stablecoin

The European Commission has already sent two questionnaires to Facebook. That is to understand better the nature of the digital good and its objectives. Still, the lack of clarity on the stablecoin does not allow to draw definitive conclusions. That is on the applicability of the regulatory framework current European Union and the way it applies, says the draft text. Earlier, US Lawmakers also concerns about Facebook Libra.

Given the nature of the challenges posed by Libra, EU policymakers and regulators now want to act quickly, says the draft text. But EU officials are also wary of the unintended consequences. A rushed regulation of Libra and other crypto-asset and Fintech initiatives could have on other crypto-asset projects.

That is why Member States have stated that the new rules should be based on substantial evidence and general principles applicable to all stablecoins. Given the global nature of the Facebook project, Europeans argue for a global response. Facebook said it would not launch Libra until all regulatory concerns are clear. So that will likely result in a postponement of the initial 2020 release.

Think we missed something? Let us know in the comments section below.

Hong Kong to Publish Crypto Exchange Regulations

The Securities and Futures Commission (SFC) will introduce a new set of Hong Kong Crypto Exchange Regulations. Meanwhile, fund managers continue to struggle with the stringent requirements for crypto investment in Hong Kong.

06 November 2019, AtoZMarketsSFC of Hong Kong is ready to introduce a regulatory framework for cryptocurrency trading in the city. Chief Executive Ashley Alder today announce the news at a local Fintech event. This framework will allow the virtual asset trading platforms to regulate by the SFC. A significant development that is an extension of the path he described at the same time last year. In 2018, cryptocurrency trading in Hong Kong was subject to increased regulatory oversight. At the time, the SFC told that it was developing a new approach to supervising the activities of local crypto exchange platforms.

Hong Kong Crypto Exchange Regulations 

According to Alder, the new regulations will focus on KYC (Know Your Customer) and custody requirements for cryptocurrency trading. Such progress could pave the way for the emergence of an official legalized cryptocurrency exchange listings in the city.

The co-founder of Primitive Ventures and Chinese crypto insider, Dovey Wan tweeted on Wednesday that the new regulations could make Huobi the first “legalized Chinese cryptocurrency exchange.”

The development of regularized cryptocurrency exchange laws will also strengthen Hong Kong’s position on regulation. That is rather than banning the trade in crypto. Former SFC head Carlson Tong Ka-shing once said that a ban on crypto trading would not work.

Like the ICOs, crypto trading is still banned in mainland China. And many platforms left the country. The regulated trade in crypto in Hong Kong will be another change from the policies in mainland China.

Read More: SFC issues CircleForex warning

Fund Managers Are Still Struggling 

The city seems to be moving ahead with crypto exchange laws. Yet, another virtual currency regulation is not yet having the desired effect. In 2018, the SFC set up a licensing system for crypto fund managers.

However, the reports suggest that a year later, fund managers are still struggling to meet regulatory requirements that essential to invest in cryptocurrencies. Some commentators say that despite the initial enthusiasm for the SFC’s decision, there has not been much progress for fund managers to obtain the necessary approvals.

Think we missed something? Let us know in the comments section below.

CFTC Fines Denari Capital with $8.3 Million FX Fraud

CFTC Fines Denari Capital and its Owners with fraudulently soliciting more than $8.3 million from at least 28 participants.

06 November 2019, AtoZMarketsThe US Commodity Futures Trading Commission (CFTC) has issued several customer protection fraud notices. That provides the warning signs of fraud, including the fraud notice on the Forex market. It alerts customers against fraud and lists simple ways to spot forex frauds.

CFTC Fines Denari Capital

The CFTC announced Tuesday that it had filed a lawsuit against the Travis Capson defendants, Arnab Sarkar, and their California company, Denari Capital, LLC. It is for committing $ 8.3 million in foreign currency fraud. The complaint was filed in the US Northern District Court of California. More specifically, the complaint accuses the defendants of fraudulently seeking more than $ 8.3 million from at least 28 participants. Recently, CFTC also fines Silver Star FX owners.

The US regulator seeks to disgorge civil monetary penalties, restitution, permanent registration, and trading bans. It also seeks a permanent injunction against other violations of the Commodity Exchange Act and the regulation of the CFTC.

Read More: Eleven Forex Brokers lose CySEC Investor Compensation Fund Membership

Why CFTC fines Denari Capital?

Capson of Utah and Sarkar of California collected this money through a simple investment plan. That included leverage or off-exchange margins on the forex. Also, Capson has been accused of making false statements to the National Futures Association (NFA).

Since at least 2012 until today, according to the CFTC’s complaint, the defendants have pooled and mixed their victims’ funds into Denari bank accounts. And they used them for various purposes. It includes foreign exchange, real estate, securities transactions, and personal expenses.

Capson and Sarkar fraudulently solicited participants and potential participants. They did that by voluntarily or recklessly making material misrepresentations. That was regarding the past profitability of Denari’s foreign exchange operations and the profits that its participants were making. The US regulator said that in a statement. The defendants also allegedly issued false statements to participants. Those were falsely represented the profitability of their respective interests in the pool. In October, CFTC files lawsuit against Nevada-based circle society

Because of the nature of the business, the defendants had to register with the CFTC. However, according to the complaint, Denari and Capson did not register until 01 May 2019. On the other hand, Sarkar never registered. During an NFA review on 15 July 2019, Capson misrepresented to the regulator, alleging the complaint. In particular, Capson stated that Denari traded only equity and hid its operations from its clients’ funds.

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CFTC Fines Silver Star FX Owners

CFTC fines $ 75,000 two co-owners of Silver Star FX for marketing their FX trading robot. They are Candace Ross-Mahmoud and Hassan Mahmoud.

05 November 2019, AtoZMarkets – Both Silver Star Live Software LLC and Silver Star Live have been fined $ 75,000 for marketing their FX trading robot. Candace Ross-Mahmoud and Hassan Mahmoud were sentenced to pay the fines. While both were co-owners, Candace was president of the company, and Hassan was executive vice president. Earlier, CFTC files a lawsuit against Nevada-based circle society.

Reason for the Fine

The charges that led to the imposition of the fine explain the period between July 2018 and March 2019. During this period, both parties improperly marketed their day trading system on the foreign exchange market with retail investors. They intentionally distorted the efficiency of their trading robot to increase sales. The defendants first sold their software for $ 199 a month, before reducing it to $ 145 a month. They paid this money to use a car trading robot and custom forms of trading advice.

The claims themselves describe their trading robot as something much more useful than it actually would be. They claimed the system would give you a profit of $ 250 to $ 600 a month with only a deposit as meager as $ 300. To add fuel to the fire, they claimed that the algorithms used by the software have already proven themselves concerning reported profits. In early October, CFTC also alleges $7 million Bitcoin fraud perpetrated.

The company has not even bothered to issue an appropriate disclaimer that the CFTC requires in its regulations. The results of this estimate that Silver Star provides to investors are based on simulated/hypothetical performance results. As a result, views have inherent limitations.

Moreover, Candace and Hassan made about their corporate biographies on SIlvestar Live. Hassan Mahmoud credits himself with being a kind of international omnipreneur and keynote speaker, who, he says, is highly sought after in the millennium community. He holds a high claim of more than $ 250 million in sales in as little as four years. These claims end with an allegation that he has helped several business owners expand their name and brand.

Read More: NY Court orders illegal Veritaseum ICO to pay back $8 million

CFTC Expressed Concerns About Auto Trading Robots 

The CFTC considers its move as a precedent for other companies if they do not comply with the requirements of the CFTC. Besides, CFTC is optimistic about Ethereum Futures contracts. Furthermore, the regulator has expressed concerns about auto trading robots. People are increasingly buying that on the Internet. The CFTC said there were more and more websites that were falsely promoting these products and similar advisory services and that investors should be cautious about these high claims.

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Eleven Forex Brokers lose CySEC Investor Compensation Fund Membership

CySEC writes off eleven handful forex brokers from its investor compensation fund membership. Besides, the list holds some now-defunct Forex brokers, including UBFS Invest, Spot Capital Markets Ltd., and Alfa-Forex.

05 November 2019, AtoZMarkets –The Cyprus Securities and Exchange Commission is better known as CySEC. It is the financial regulator of Cyprus. As an EU Member State, the regulation and financial operations of CySEC also comply with the European MiFID Financial Harmonization Law.

11 investment companies left/deleted from the ICF

CySEC announced today that 11 investment companies had been removed from the Investor Compensation Fund. However, the reason behind it is that the 11 companies in question lost their CIF license.

The companies who have left/deleted from the ICF are:

  1. Argo Capital Management Cy Ltd
  2. Centaur Financial Services Ltd
  3. DFG Capital (Cyprus) Ltd
  4. Globesco Capital Ltd
  5. Kit Finance Brokers Ltd
  6. Lykke Cyprus Ltd
  7. NTFX Capital Ltd (ex. Alpha Forex Ltd)
  8. Postscriptum Capital Ltd
  9. SL Capital Services Ltd
  10. Spot Capital Markets
  11. UBFS Invest – Moneychoice Brokers Ltd

The regulator notes that the loss of Fund membership does not mean the loss of the rights of the covered clients to compensation in respect of investment transactions made prior to the loss of membership.

Read More: Italian Regulator Blocks Six Unauthorized Forex Trading Websites

Changes to the legal framework

Recall that last March, CySEC announced changes to the legal framework governing the operation of the ICF.  As a result of these amendments, any provision relating to the limitation or refund of membership fees paid to the ICF under the new ICF directive will be removed. Yesterday, CySEC Lifts IGM Forex Suspension.

Therefore, ICF members require to maintain a minimum liquidity reserve of 3% (3 per 1,000) of their clients’ eligible funds and financial instruments. So, the client must independently audit and sort that.

The amendments do not envisage any limitation on the potential extraordinary contributions of an ICF member. Besides, in the event of an adverse scenario requiring the ICF to finance the investor compensation if that meet the necessary conditions.

The new rules apply the discretionary power provided by Directive 97/9 /EC with regard to investor compensation levels. So that the maximum limit of compensation coverage is € 20 000 or 90% the hedged investor’s claim, whichever is lower.

The requirement to participate in the ICF applies to all entities providing investment services and ancillary care. Regardless of whether the clients’ funds and financial instruments held or not. So, this means that participation in the ICF is also mandatory for Cyprus investment firms (CIF).

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Italian Regulator Blocks Six Unauthorized Forex Trading Websites

 Italian Regulator orders blocking of six unauthorized Forex Trading Websites. These orders were issued under the Growth Decree. That allows the Italian regulator to order ISPs for blocking access to those illegal websites in Italy.
04 November 2019, AtoZMarkets – CONSOB (Italian Companies and Exchange Commission) is the Italian governmental authority. It is responsible for the Italian securities market regulation. Also, that includes the regulation of the Italian Stock Exchange, the Borsa Italiana.

Italian Unauthorized Forex Trading Websites

CONSOB has once again made use of the powers under the so-called Growth Decree. It orders to block more websites. Those websites are operated by online trading companies that are not allowed to offer their services to Italian investors.
The latest orders, released today, are for the following six websites:
  • TomCom Limited (https://royalfxpro.eu);
  • Bonatech Ltd and Mitchell Group EOOD (https://ccxcrypto.com);
  • Next Trade Ltd and TLC Consulting Ltd (https://aspenholding.co and https://aspen-holding.com);
  • Trader Platinum (www.traderplatinum.com);
  • London Capital Trade Ltd (www.londoncapitaltrade.net).
The regulator notes that implementing access restrictions takes time. And that should come into effect within a few days.

CONSOB already issued blocking orders for several websites

Until 2017, CONSOB issued “warnings” about the risks associated with services offered by unauthorized operators. That addressed only the general public. However, since 2018, with the application of the new European regulation on the provision of investment services (Mifid2), the instruments given to CONSOB. That has considerably strengthened by the allocation of the unique power to order the cessation of the infringement of unauthorized operators.
As a result, CONSOB had only the ability to request the cancellation of the Italian version of the abusive sites to the hosts. CONSOB regularly makes use of the powers granted to it by the “Growth Decree.” The regulator issued blocking orders for 20 websites of online trading companies in October 2019.
As AtoZMarkets pointed out earlier, the Italian securities regulator warned on 30 September against another list of companies. The list includes 4xRoyal Ltd., Game Capital Ads Ltd., Kronosinvest, Sky Hub Limited, and Zuitex, among others. Therefore, those engaged in illegal and misleading business practices. Those are also with respect to the promotion of several financial products.
CONSOB blacklisted websites deal with crypto-focused assets and CFDs. Also, the Italian regulator has warned those brokers offer cryptocurrency trading services without having the proper permissions. However, it continuously updates one of the most comprehensive lists of unauthorized financial service providers. That list for those who are operating illegally in Italy. Thus, the trader should avoid these blacklisted-brokers for safe transactions.
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2019 British Crypto Tax Guidelines You Should Know

British tax authority issued Crypto tax guidelines for businesses on 01 November 2019. That is complementing its previous guidelines for individuals.

04 November 2019, AtoZMarkets – The guidelines clarify how the capital gains tax, national insurance contributions, income tax, corporate tax, and others. In particular, Her Majesty’s Revenue and Customs (HMRC) does not consider cryptocurrencies as currency or shares or securities. That largely exempts these cryptocurrencies from stamp duty. However, tokens used in debt transactions are still subject to stamp duties.

2019 British Crypto Tax Guidelines

The HMRC also requires companies to keep records of cryptocurrency transactions in pounds. And companies also have to keep records of the valuation methodology for these transactions. Companies have to record the amount spent on each type of token.

The new guideline also provides information on how various types of taxes. They are capital gains tax, corporation tax, national insurance contributions, income tax, VAT, and other. That will apply to which deal with cryptocurrency operations.

The guidelines specified that if an enterprise buys and sells exchange tokens, exchanging tokens for other assets or providing goods/services in exchange for tokens. It will most likely have some form of tax. The amount of tax will depend on the company’s income, expenses, profits, and earnings. This information must be provided in the tax return submitted by the company.

The guidelines also stated that each case would be assessed individually. HMRC will consider each case based on its facts and circumstances. And that will apply relevant legislation and case law. That is to determine the correct tax treatment. It is also including, where appropriate, contractual terms governing the exchange tokens.

Read More: New 2019 IRS Crypto reporting guidelines for US residents

Earlier HMRC requested customers history

In August, HMRC requested that cryptocurrency exchanges provide the identity and transaction history of customers. The agency aimed to address the perceived problem of tax evasion on digital trading platforms. At the time, HMRC had requested documents only for the last two or three years. That means that the early investors in the field of cryptocurrency would not be affected.

In December 2018, the HMRC released a cryptocurrency tax guideline for individuals. That clarified several tax issues. That is related to airdrops, forks, and mining. The 2018 Guideline also requires individuals to maintain records for each cryptocurrency transaction in pounds.

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