14th March 2024 > > Mastercard & taxes.

tl;dr

Mastercard wants to help facilitate the spending of cryptos. The tax implication of doing so is a massive deterrent.

Market Snap

Market Wrap

Elon Musk commented “Dogecoin to the moon”, and though we didn’t quite get there, we saw an immediate 10% pop. Memecoins are getting a lot of attention right now, but be careful, many are scams. Those stories you read of making 10,000s of % simply aren’t true.

Oh, and by the way, there was another ATH an hour ago.

Curious Cryptos’ Commentary – Mastercard

Mastercard has long been winning the crypto race amongst its peer set. Think of Visa as the Vanguard of payment processors, and you will get close to its actual position, not its fake public one. PayPal is a surprising laggard too.

Mastercard and MetaMask are trialling a card that is truly decentralised except in one important aspect – you will have a physical card that can tap and pay.

The concept is that crypto holders can use their cryptos to pay for ordinary, everyday purchases. I find this a little surprising to be honest, but we know that initiatives like this are only ever driven by client demand.

One word of warning. The complexity of your annual tax return after using cryptos for payments would break far more robust people than I. This is probably a deliberate policy, a policy that is a fair reflection of the antipathy towards cryptos driven throughout government and government agencies by one Rishi Sunak.

Curious Cryptos’ Commentary – UK crypto taxes

In anticipation of selling many of my small cap, high risk coins into fiat once BTC gets firmly lodged into the six-figure range, I have been spending a few days looking into the tax implications of doing so.

The rules may surprise you, and not necessarily in a positive sense.

I hope to be able to share with you some key principles and guidelines soon. Obviously, this won’t be financial or tax advice, but it might help to highlight some potential pitfalls. HMRC loves to hammer the little guy who makes self-assessment mistakes, though in reality it does not have that power by law. It has awarded itself the role of judge, jury, and executioner, for the cost of taking HMRC to court is prohibitive.

However, if you can show you have taken reasonable care and attention, and can point to documentary evidence, the right tax inspector can prove to be surprisingly reasonable, or so I have been told.

The alternative is to have friends in high places.

David Mills, former husband to ex-minister Tesse Jowell, would have faced a prison sentence of more than four years in Italy because of tax dodges in Italy and the UK, except for the deliberate delaying tactics of the UK judicial system, and HMRC’s lenient bend over backwards approach to his tax fraud.  I suspect, though I cannot prove it, that such largesse would not be extended to you or I.