Can we pool our knowledge regarding TAX and crypto and make some kind of FAQ/sticky?

pioneerpro

bfa1509 wrote: »

The irony that a technology created to remove the middleman is now regulated and controlled by the middleman.

Who the hell are crypto service providers in Ireland? I've never heard of anybody using any exchange that doesn't use KYC stuff - e.g. Kraken.

Peregrinus

pioneerpro wrote: »

Who the hell are crypto service providers in Ireland? I've never heard of anybody using any exchange that doesn't use KYC stuff - e.g. Kraken.

The legislation doesn't apply just to crypto service providers who themselves are based in Ireland, but also to crypto service providers based elsewhere who are providng services in Ireland - i.e. to Irish-resident customers.

It's an EU-wide thing, so service providers based anywhere in the world providing services to EU customers have three options:

1. Stop providing services to EU customers.

2. Register with national authorities in each EU member state where they provide services, and comply with the regulatory requirements.

3. Provide services illegally.

Most will choose option 2. Some will choose option 1. A few may choose option 3, but you'd want to be fairly desparate to let your crypto assets be held on your behalf by someone who's a law-breaker by policy. So the market for those offering services illegally will probably be fairly small and specialised.

Elessar

Peregrinus wrote: »

The legislation doesn't apply just to crypto service providers who themselves are based in Ireland, but also to crypto service providers based elsewhere who are providng services in Ireland - i.e. to Irish-resident customers.

It's an EU-wide thing, so service providers based anywhere in the world providing services to EU customers have three options:

1. Stop providing services to EU customers.

2. Register with national authorities in each EU member state where they provide services, and comply with the regulatory requirements.

3. Provide services illegally.

Most will choose option 2. Some will choose option 1. A few may choose option 3, but you'd want to be fairly desparate to let your crypto assets be held on your behalf by someone who's a law-breaker by policy. So the market for those offering services illegally will probably be fairly small and specialised.

It's not clear yet if this applies to crypto service providers not based in Ireland. The registration requirement is not EU wide, its just a thing that Ireland added to their legislation for god knows why.

Central bank site mentions firms 'established in Ireland', that sounds to me like Irish based & registered companies.

Regardless the AMLv5 legislation has been law for a while now in Europe so any EU based crypto exchange worth their salt will already be compliant in that regard. This new (Irish only I might add) requirement to register your crypto service is just another ridiculous Irish-ism where we for some reason decided to put additional unnecessary roadblocks in the way of innovation and enterprise.

pioneerpro

Elessar wrote: »

It's not clear yet if this applies to crypto service providers not based in Ireland. The registration requirement is not EU wide, its just a thing that Ireland added to their legislation for god knows why.

Central bank site mentions firms 'established in Ireland', that sounds to me like Irish based & registered companies.

Regardless the AMLv5 legislation has been law for a while now in Europe so any EU based crypto exchange worth their salt will already be compliant in that regard. This new (Irish only I might add) requirement to register your crypto service is just another ridiculous Irish-ism where we for some reason decided to put additional unnecessary roadblocks in the way of innovation and enterprise.

Yeah this was exactly my read on it. Revenue/Government 'catching up' with their ridiculous lack of engagement with crypto this decade in the only way they know how - ambiguous legislation.

I can't think of any exchange that you can SEPA or CC purchase coins from in an Irish jurisdiction that doesn't adhere to AMLv5/KYC regulations for a number of years now.

I also can't think of a single 'Irish' exchange - maybe they're seeing a glut of LLCs or something hedging with BTC or there was some recent case(s) in relation to laundering/evasion. Could be as simple as CAB seeing an uptick from years back and finally getting the legislative push sorted.

timeToLive

pioneerpro wrote: »

You only pay CGT once you realise a gain on the asset - via trading, disposing etc... So if you just mean a simple fiat -> cyrpto purchase in 2017, then obviously your capital (the initial purchase price) doesn't factor in.

Formula for CGT owed before you hit your threshold per annum is basically (Gain from Disposal - Purchase Price x 0.33) - €1,270

Why is your advice different to what revenue say? https://www.revenue.ie/en/gains-gifts-and-inheritance/transfering-an-asset/how-to-calculate-cgt.aspx



If gain from disposal is 5000, purchase price is 50:



You think it is:

(5000 - 50)*0.33 - 1270 = 363.5 cgt to be paid


Revenue says:
((5000 - 50)-1270)*0.33 = 1214.4 cgt to be paid

pioneerpro

timeToLive wrote: »

Why is your advice different to what revenue say? https://www.revenue.ie/en/gains-gifts-and-inheritance/transfering-an-asset/how-to-calculate-cgt.aspx



If gain from disposal is 5000, purchase price is 50:



You think it is:

(5000 - 50)*0.33 - 1270 = 363.5 cgt to be paid


Revenue says:
((5000 - 50)-1270)*0.33 = 1214.4 cgt to be paid

Sorry, you're right - I was posting that off a phone and was rushing. Your second post is exactly as I have it in Excel/Python. Good catch.

Technope87

Hi all, I have a query on transferring funds. So I invested in an eth tracker fund on my DEGIRO account but I’d like to move it to ethereum on Coinbase. Is there a way that I could transfer with out being liable for tax on the profit or is it a case of my only option being taking it out of the tracker fund, paying the cgt and then investing through my Coinbase acc?

donnaille

Technope87 wrote: »

Hi all, I have a query on transferring funds. So I invested in an eth tracker fund on my DEGIRO account but I’d like to move it to ethereum on Coinbase. Is there a way that I could transfer with out being liable for tax on the profit or is it a case of my only option being taking it out of the tracker fund, paying the cgt and then investing through my Coinbase acc?

Without knowing the detail, it sounds like these are different investment products - selling on DEGIRO will indeed trigger a CGT event.

Technope87

donnaille wrote: »

Without knowing the detail, it sounds like these are different investment products - selling on DEGIRO will indeed trigger a CGT event.

Yeah they are completely different, I assumed there was no way around it but I wasn’t sure so thought I would check here.

When I invested in the eth tracker fund I didn’t even know what staking etc was but now that I do I want to invest in ethereum rather than the tracker but to do so I’ll have a tax liability unfortunately!

Rob2D

Anyone messing around with Koinly much? Like making edits. I linked my stuff but since I didn't start on any exchanges plus having to add Uniswap things means my Koinly is all messed up.

It looks a bit daunting to jump in there and edit. Could take me a long time.

bfa1509

Very confusing question ahead, forgiveness please.

I have a realised loss of €2500 from 2020. I have a realised gain of €3000 so far this year. When do I carry forward the loss to offset my gain?

Scenario A
Don't pay any tax this year as 3000-2500-1270 = No tax owed, then report this calculation next year.

Scenario B
Pay (3000-1270)*0.33 = €570 CGT tax due in November 2021
Lets say I don't make any more transactions in 2021 then in 2022 I report 3000-2500-1270 -> make an appeal to get the €570 back

I know I don't owe anything, this is just a question of how to report this properly.