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2023-03-31

How Investing vs Trading impacts tax

In most cases of buying and selling cryptocurrency as a retail investor, you are participating in investing rather than trading. The two are treated differently for tax purposes.

  • Investing is subject to capital gains tax or income tax, depending on the nature of the transaction.
  • Trading in this case refers to self-employment which is subject to income tax and National Insurance Contributions.

The key difference between investing and trading – along with the different tax treatments, is how losses generated in the crypto-activity can be used.

In their guidance, HMRC have explicitly stated that they would expect it to be exceedingly rare that any crypto-activity constituting buying & selling crypto would be classified as “trading”.

If you are uncertain, speak to a tax advisor as there are always exceptions, including but not limited to, developing tokens and large scale mining.

How is crypto tax calculated in the United States?

You can be liable for both capital gains and income tax depending on the type of cryptocurrency transaction, and your individual circumstances. For example, you might need to pay capital gains on profits from buying and selling cryptocurrency, or pay income tax on interest earned when holding crypto.

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31
 
Mar
 
2023
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10
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Product update - 18th May 2022

At Summ (formerly Crypto Tax Calculator), we are constantly working on improving our product so you can have the best experience at tax time. Check out our blog for the latest product updates.

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This tax guide is regularly updated: Last Update  
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It’s that time again, we’ve got a whole bunch of exciting updates to the Summ (formerly Crypto Tax Calculator) platform to announce!

First up, users now have the ability to generate a German SO form. This means that our German users can have a more native experience when using our platform!

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Next is a much-requested feature from our users: the ability to add comments to transaction lines. After this update, you can now leave comments on any of your transaction lines, as well as delete any. Each comment will have a timestamp associated with it, so you can keep track of any notes you’d like to make! We’re also working hard on giving you the ability to edit comments, and filter by comments, so keep an eye out there.

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We thought we’d wrap this product update blog up with a big one… We are happy to announce we now have ERC-1155 token support in-app for Arbitrum, Avalanche, Binance Smart Chain, Ethereum, Fantom and Polygon networks! This is huge news for anyone deep into NFT trading, as you’ll now be able to track minting and selling ERC-1155s on these networks, as well as converting an ERC-721 to a ERC-1155.

Les informations fournies sur ce site Web sont de nature générale et ne constituent pas des conseils fiscaux, comptables ou juridiques. Il a été préparé sans tenir compte de vos objectifs, de votre situation financière ou de vos besoins. Avant d'agir sur la base de ces informations, vous devez déterminer si elles sont appropriées au regard de vos objectifs, de votre situation financière et de vos besoins et demander conseil à un professionnel. Crypto Tax Calculator décline toutes les garanties, engagements et garanties, explicites ou implicites, et n'est pas responsable de toute perte ou dommage de quelque nature que ce soit (y compris une erreur humaine ou informatique, négligente ou autre, ou une perte ou un dommage accidentel ou consécutif) résultant de, ou en relation avec, toute utilisation ou confiance accordée aux informations ou aux conseils de ce site Web. L'utilisateur doit assumer l'entière responsabilité liée à l'utilisation du matériel de ce site, quel que soit le but pour lequel cette utilisation ou les résultats sont appliqués. Les informations de ce site Web ne remplacent pas les conseils d'un spécialiste.

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