The UK government published tax guidance on Wednesday requesting that holders of crypto, NFTs, and utility tokens disclose any unpaid tax that may have accrued from their crypto profits, or face penalties.
The disclosure published by HM Revenue and Customs (HMRC) is voluntary, but the guidance stresses “If you do not contact us to declare your unpaid tax, you could be liable to additional interest and penalties.”
The guidance details how to make the crypto tax disclosure so that the UK’s tax agency can figure out how much you owe, what penalties might affect you, what interest you owe, and how many years of unpaid tax you need to pay.
To do this, it asks for information including how many times a crypto asset has been transacted, how much it cost to buy, any crypto exchanges that were used, and any profits you made.
It states that if a successful disclosure is made and tax is due, the applicant has 30 days to pay HMRC any unpaid tax.
However, the guidance notes that if HMRC discovers someone “knowingly gave us incorrect information on your disclosure, we may look at your tax affairs again and you may be liable to higher penalties.”