Oddbean

CGT is payable on realised Bitcoin profits at 20% in the UK. Most onramps and most offramps for BTC are KYC'd meaning while the tax authority don't care how you made gains, they will take 20% of them. There is a movement that looks at non KYC Bitcoin options such as Bisq, CoinJoin (Jam) and Liquid as obfuscation methods for Bitcoin, but ultimately if you want to spend your BTC profits in a fiat world you have to pay tax. The UK does have an exit tax, you currently have to pay 20% CGT on unrealised assets (i.e. Bitcoin gains etc...) this is going up to 39% on the 30th October budget, The only unknown is when this 39% will come in to effect. If I cant exit before this raise comes into effect, I will remain a UK tax payer, but be non-dom.

Wow, ok. I was a bit unclear what the exit tax situation was as I remembered seeing a lot of discussion around the topic, but you're saying that some exit tax is already in place? I did some googling before posting and all I saw was headlines on some _potential_ tax being considered, but of course these things are complicated... and 39% is insane.

It is not specifically an exit tax, but you do have to "settle your account" by paying CGT on the profits you would make if you sold your assets at the time of leaving the UK. i.e. unrealised CGT gains

Thank you, but you are unclear as to what you don't believe or why and you haven't provided any evidence. If I'm wrong about anything and you have evidence to prove it, I would be extremely grateful if you could provide it. Even HMRC can make mistakes 😂

Thanks for this. I am not discussing CGT I am discussing CGT on unrealised gains. This is what happened to Roger Ver. He paid all his taxes correctly and left the US. However, he left holding undeclared Bitcoin, which even at that time had made an unrealised profit. He is being held in Spain for not declaring his Bitcoin and not paying CGT on his "unrealised gains" as of 2014. He is not liable, however, for the gains that BTC has made since 2014. While the UK is a different regime, the same applies here. The only difference with BTC is you can take it in your head or on a piece of paper. You cannot take a second home with you.

Can you link to something that supports that *unrealised* CGT is a thing in the UK? I've not found anything that says it is unless you dispose of the asset in which case, that's realised, not unrealised.

This explains it in a roundabout way: Held-over gains Before leaving the UK, it is important to check whether an individual’s switch to becoming non-UK resident/non-UK ordinarily resident will trigger previous CGT liabilities that they have deferred by the use of holdover relief. If you leave the UK within 6 years of receiving a gift that you elected to hold over the gains, a CGT charge could be triggered on the whole of the held over gains. https://trinityfinancial.ie/leaving-the-uk-capital-gains-tax-implications/

This sounds to my (totally non-educated) ear as a potential misunderstanding. These kinds of misunderstanding are quite common even among professionals, as they are often trained to work and think within one jurisdiction and not look at the big picture - which can be totally different. I've been there, almost listened to the advice of "certified professionals", and I've been able to avoid costly mistakes by being extremely meticulous and searching for better advisors until someone really knows what they're talking about. That part you copied seems to be about an _existing_ tax liability that just needs to be settled at some point. Moving switches that "some point" to be immediate, as they don't let you postpone it into the future after you leave. If so, it's not an exit tax, just "settling current accounts". There is a similar confusing reference to an "exit tax" in this video: https://youtu.be/XD_97P_L7GA?t=285 ...where it seems that _existing_ profits of a company are taxed when the company exits the UK. That's understandable and not an "exit tax" - just the settlement of existing liabilities at that moment. Those taxes would have been due anyway, just later. I don't see anything about extra taxes incurred because of exiting, except in those future plans. Again, I might be wrong about any of this, but so can the "professionals" - worth checking thoroughly with multiple professionals before you pay too much!

Yes, you've hit the nuance on the head. It isn't an exit tax, but it is a tax that you incur by exiting as you are settling a tax bill you would've had if you'd sold the appreciated assets at the point of leaving. I found it very difficult to explain that nuance without calling it an exit tax, which caused the discrepancy as others correctly pointed out there is not exit tax. As you've gone through a similar journey, I always like to ask people, do you know anything I don't know, but should? Have a great weekend and thanks

I expect an increased CGT will come into effect immediately if they really do it. Afaik, dropping your British citizenship wouldn't trigger a CGT on Bitcoin holdings unless you also liquidate to dirty fiat at the same time.

I think you’re right about immediate CGT rise implementation. Citizenship would be the last element I’m looking at. While I may or may not leave the UK tax system dependent on the increase in CGT in unrealised assets (kind of an exit tax), I probably won’t renounce my citizenship, rather obtain multiple passports. But all my decisions are monitoring the world situation and are flexible.