The UK tax authority has announced that it plans to treat “certain divestitures” related to cryptocurrency lending and liquidity pools as transactions that would effectively defer the country’s capital gains requirements.
In an announcement on Monday, HM Revenue and Customs (HMRC) he said that from April 6, 2027, it will adopt a “no gain, no loss” approach to the divestment of crypto loans and liquidity pools. According to the tax authority, the measure would defer capital gains tax on digital assets “until economic sale.”
“This measure will support fairness in the tax system,” the UK tax authority said. “It aligns the tax treatment more closely with the economics of these arrangements, ensuring that gains and losses will generally only be recognized when a participant makes an economic sale of cryptocurrencies.”
The measure, expected to affect around 700,000 individuals and fiduciaries, would represent a significant change from the authority’s 2022 guidance on cryptocurrency liquidity pools and lending following a consultation period. Under Great Britain law in 2025-2026, taxpayers will pay between 18% and 24% for capital gains related to cryptocurrency transactions, depending on whether they qualify as basic rate or higher rate.
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According to the tax authority, under UK capital gains rules it would treat cryptocurrency transactions as “no gain, no loss” in the case of the acquisition or disposal of shares in a loan agreement in exchange for the same type of assets, borrowed assets acquired at market value and on similar terms from automated market makers.
“This is the right direction, driven largely by feedback from the industry which indicates that any other approach would create a significant administrative burden for the taxpayer.” he said Aave founder and CEO Stani Kulechov in Monday’s X post.
A cryptocurrency candidate is in the race for Nigel Farage’s by-election
In British politics, reform leader Nigel Farage will not be completely unopposed in a by-election following his resignation last week amid reports that the politician is receiving donations from billionaires linked to the cryptocurrency industry.
On Tuesday, the leader of social group Solana Superteam UK, Stephen Newnham, said he would run as an independent candidate against Farage and others. The by-election to represent Clacton is scheduled for and will take place on August 13 switch on candidates such as comedian and author Jon Harvey in the costume of Count Binface, a self-proclaimed “independent space warrior” wearing a helmet shaped like a trash can.
Farage triggered a by-election with his resignation, saying he wanted the people of Clacton to judge his actions. The reform figure reportedly received a $6.7 million donation from crypto billionaire Christopher Harborne, which he described as a “reward” for Britain’s exit from the European Union, and later as a “gift” and other financial assistance from George Cottrell, a convicted fraudster with ties to a cryptocurrency casino.
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