Correct Tax Treatment for UK Staking
planned
Emma - CoinTracker
What is being requested?
Update the UK tax treatment of staking transactions to reflect current UK guidelines and provide optionality for users to apply the treatment based on how staking is performed (e.g., solo staking vs. pool staking).
Why is this needed?
Currently, UK staking is automatically treated as taxable.
However certain staking methods (e.g., solo staking) may not be taxable. Automatically treating all staking as taxable may lead to inaccurate tax reporting and create additional work for users.
What can users do now?
There is no current workaround. Users should wait for a fix from our engineering team.
Users can upvote this post to be notified of progress.
Keywords: UK staking, staking treatment UK, tax optionality, UK crypto tax
Log In
Sarah T. - CoinTracker
planned
C
CT-4WZGRJGr26Mj2
Looking forward to this fix. Many thanks, team!
This post was marked as
being verified
Emma - CoinTracker
Merged in a post:
UK tax reports must deduct fees in the calculation of staking income from Kraken
C
CT-ZX6PaBqm
When Kraken provides staking rewards, Cointracker currently considers 100% of the reward as 'staking income' and then considers the 20% fee paid to Kraken as a token sale that gets subject to capital gains. UK tax guidance, however, is clear that staking income should exclude any associated costs.
"If the activity does not amount to a trade, the pound sterling value (at the time of receipt) of any tokens awarded will be taxable as income (miscellaneous income) with any appropriate expenses reducing the amount chargeable."
Thus, the correct treatment should have been to consider 80% of the reward amount as 'staking income' and for the remaining amount to not be considered as a receipt at all (thus no need for any capital gains eligible transaction for the fee).
As it currently stands, the 'staking income' calculated by Cointracker for UK customers is overstating the true figure and without any manual correction would result in a higher tax liability for customers.
Emma - CoinTracker
confirmed