UK government defers capital gains on certain crypto with ‘no gain, no loss’ approach

The change in tax policy, expected to impact about 700,000 people in the UK, was related to the disposal of crypto in lending and liquidity pools.

The UK’s tax authority announced that it planned to treat “certain disposals” related to cryptocurrency lending and liquidity pools as transactions that would effectively defer the country’s capital gains requirements.

In a Monday announcement, HM Revenue and Customs (HMRC) said that starting on April 6, 2027, it would adopt a “no gain, no loss” approach to disposals involving crypto loans and liquidity pools. According to the tax authority, this measure would defer capital gains tax on digital assets “until an economic disposal.” 

“This measure will support fairness in the tax system,” said the UK tax authority. “It aligns the tax treatment more closely with the economics of these arrangements by ensuring that gains and losses are generally recognized only when the participant makes an economic disposal of the cryptoassets.”

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