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mining cryptos

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Newbie

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Replies 2

HI i like to know if i mine crypto and i mine $200 worth and your value is $1000 at end of june 30 how much tax i pay on this even if i never dispoal or traded it  or if i send it to a another wallet on exchance does this incur a taxable event or not even that it still in same currantcy but send to different wallet and both wallet registed under you own name

or i only pay tax if i withdrawn it

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Best answer

Community Support

Replies 0

Hi @thesuperpro,

 

Thanks again for getting in touch!

 

As discussed on your previous posts, cryptocurrency is considered a capital asset and tax implications may arise when you dispose (trade, sell or gift) of your cryptocurrency.

 

You can find more information on our guide on How do I calculate capital gains tax on cryptocurrencies?

 

Thanks, JodieH.

2 REPLIES 2
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Taxicorn

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Sounds like initially you would be classified as a Hobby Miner.

 

A hobby miner is someone who participates in cryptocurrency mining/forging as an enjoyable pastime not in a business-like manner seeking commercial profits. Their investment in mining equipment will be relatively insignificant - a small scale operation typically at home - and intention to accumulate the rewarded coins rather than sell immediately to turn a profit.

 

If you’re a hobby miner or forger, then broadly speaking this is how you’re taxed:

 

* Rewarded coins are not income but rather a capital acquisition.

* Cost of equipment is allocated as a cost of acquisition of the rewarded coins.

* Running costs are also allocated as a cost of acquisition of the rewarded coins.

* On disposal of the rewarded coins, gains are 100% taxable if within 12 months of being acquired

   otherwise 50% taxable where held for more than 12 months

 

 

Highlighted

Best answer

Community Support

Replies 0

Hi @thesuperpro,

 

Thanks again for getting in touch!

 

As discussed on your previous posts, cryptocurrency is considered a capital asset and tax implications may arise when you dispose (trade, sell or gift) of your cryptocurrency.

 

You can find more information on our guide on How do I calculate capital gains tax on cryptocurrencies?

 

Thanks, JodieH.