Starting Jan. 1 2023, foreign investors purchasing crypto through local UK investment managers or brokers are exempt from additional tax
UK Prime Minister Rishi Sunak aims at attracting foreign investors to the country. The updated tax break for foreigners he announced in December 2022 has come into force on Jan.1 2023.
Previously, foreign investors were exempt from paying UK taxes while hiring UK-based investment managers. Now, this tax exemption is expanded to ‘designated crypto assets’ to maintain the UK status as an international investment management hub.
The new rules would apply to the 2022/2023 tax year and subsequent years for income tax.
Additionally, UK regulators are actively working on legislation regarding the crypto sector. Thus, Financial Services and Markets Bill, which would give local financial regulators more control over cryptocurrencies, is currently being debated in Parliament.
Back in April 2022, the UK government announced legal steps it would take to recognise stablecoins as a valid form of payment. Besides, the HM Treasury also plans to implement a “sandbox” to test out innovative financial market infrastructures this year, as well as start consultations on CBDC.
UK will also proactively explore the benefits of Distributed Ledger Technology (DLT) for financial markets. In particular, the government wants to explore the feasibility of using DLT for sovereign debt instruments.
All these initiatives are parts of wider plans to make Britain a global hub for crypto asset technology, innovation and investment.