“A defence of ignorance of the law” is no longer going to be accepted by those who fail to disclose the crypto they own.
Britons suspected of tax evasion and avoidance will be ordered to share data on their cryptocurrency holdings, an accountancy firm has said.
UHY Hacker Young says Her Majesty’s Revenue and Customs is keen to stop money from organized crime “slipping through its fingers.”
All of this comes against a backdrop of “increasing concern” that the taxman hasn’t been able to identify the cryptoassets used by tax evaders.
Now, those facing an investigation at the hands of the taxman will need to disclose cryptocurrencies including Bitcoin and Ether, assets in “value transfer systems” such as black market pesos, and assets held in electronic money wallets such as PayPal.
According to UHY Hacker Young, those who are found lying about their cryptoassets can expect to be prosecuted by HM Revenue and Customs.
One of the accountancy firm’s directors, David Jones, said:
“HMRC suspects that an increasing amount of hidden wealth is slipping through its fingers thanks to the rise of cryptocurrencies and other unsanctioned money transfer systems. This demand for information is an important step in HMRC’s fightback against that.”
A new handbook has also been published by the taxman, which warns that “a defence of ignorance of the law” is no longer going to be accepted.