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UK Bitcoin Tax for Miners: Income, Gains and Records
Understand UK Bitcoin tax for ASIC miners: pool rewards, GBP valuations, later sales and swaps, costs, Section 104 records and HMRC reporting.
Bitcoin mined through a pool can create income when received and a gain or loss when later disposed of. Wallet movements, Lightning or payment activity must be classified by their substance.
TL;DR
- Bitcoin mined through a pool can create income when received and a gain or loss when later disposed of. Wallet movements, Lightning or payment activity must be classified by their substance.
- Keep contemporaneous GBP valuations and evidence for income, acquisitions and disposals.
- Use current HMRC guidance and obtain qualified advice for the facts of your operation.
Bitcoin mining rewards
HMRC considers the activity, organisation, risk and commerciality when deciding whether mining is a trade. If it is not a trade, the sterling value of awards can be miscellaneous income with appropriate expenses.
Pool payouts and thresholds
Keep worker and account statements, payout rules, fee details and the time each amount becomes available. The pool's display date, blockchain confirmation and wallet receipt may differ, so use the contract and a consistent policy.
Selling, swapping and spending Bitcoin
A sale for sterling, swap into another token and payment for hardware or hosting are usually disposals. A transfer between wallets under the same beneficial ownership is normally not.
Cost basis for mined Bitcoin
Link the GBP value recognised as income to the quantity received. Later disposals use the statutory matching and pooling rules. Electricity and hardware costs do not become the Capital Gains Tax cost of the Bitcoin.
Operational and tax records
Reconcile pool payouts, self-custody wallets, exchange accounts and invoices. Keep keys and seed phrases out of tax workpapers; addresses and transaction identifiers are normally enough to evidence flows.
Useful next steps
Authoritative references
Use current official guidance because tax rules and HMRC guidance can change.
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