The Federal Fiscal Court (BFH) decided that profits from buying and selling cryptocurrencies are subject to income tax for the first time in a judgment published on 28 February 2023. In addition, the court confirmed the speculation period of one year. According to the BFH, virtual currencies are economic goods that have a market value and are bought and sold as a means of payment on trading platforms. The profits from this are therefore subject to the Income Tax Act as "private sales transactions".
On the other hand, in January 2023, the UK announced enforcing a tax exemption for foreign investors purchasing crypto through local investment managers or brokers. Additionally, the Financial Services and Markets Bill, which, if passed into law, would give local financial regulators more control over cryptocurrencies, is currently being debated in Parliament. The UK Treasury also intends to begin a consultation on how the cryptocurrency industry can be regulated in the upcoming weeks.
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