The UK government is looking to make the country a hub for cryptocurrency by offering a tax exemption to foreign investors who purchase digital assets through local investment managers or brokers.
The exemption, introduced by the Prime Minister Rishi Sunak, will take effect on Sunday. And is meant to attract more global investment in cryptocurrency and boost the UK’s position as an investment management hub.
In December, the HM Revenue and Customs, the government’s tax arm, announced the exemption, stating that it would “attract global investors, meaning foreign investors won’t be brought into UK tax simply by appointing UK-based investment managers”. The exemption now includes crypto assets in order to further this goal.
The UK already has a tax guide in place for resident crypto traders, and is in the process of considering regulatory measures for the sector through a consultation process. The parliament has already begun surveying investors and professionals on how Decentralized Finance (DeFi) should be taxed. The parliament is also debating the Financial Services and Markets Bill, which, if passed into law, would give local financial regulators more power over the crypto industry.