The government has spoken. According to the United Kingdom authorities, Bitcoin exchanges and companies operating in the country don’t have to register with HM Revenue & Customs (HMRC), under money laundering regulations. At least, not immediately.
After some pressure made by the leading British exchanges, which wanted to know the rules and avoid an episode similar to what’s happening in the USA, the HMRC issued a letter. The missive, addressed to Joel Jean-Luc Dalais, director of the future exchange FYB-UK, confirmed that, for now, this is not a problem for the exchanges. However, HMRC also reveals that it’s closely monitoring the cryptocurrency situation.
Here’s an excerpt from the letter:
With reference to your enquiry at this time there is no requirement to register with HMRC under the Money Laundering regulations, however HMRC recognise that the issuing of Bitcoins represent an emerging development.
We are currently in discussions with HM Treasury concerning this market and whether HMRC will be a Supervisor for this market. HMRC will be watching any developments relating to the Bitcoin market and may change our view, therefore I would suggest that you regularly check our news and update section on our website at www.hmrc.gov.uk/mlr and sign up for our e-mail alert system at www.uktradeinfo.com/AboutUs/Pages/EmailAlertServices.aspx.
If at any time HMRC recognise Bitcoins as a currency you would then have to register straight away without any prior correspondence from HMRC as this would be your responsibility to register should the ruling change regarding Bitcoins under the Money Laundering regulations.
According to Joel Jean-Luc Dalais, “regulation will definitely come into play at some time in the future, so it is in the best interest of businesses that think they are transacting as a money services business to still keep anti-money laundering and know-your-customer practices in play so they’re prepared for when HMRC does come knocking”.
There might not be a specific regulation for now, but like we already know and according to a former announcement made by HMRC, the standard British tax rules apply to cryptocurrency. In other words, whoever is receiving Bitcoins in return for goods and services will have to pay taxes on any profits.