The clear and simple law in the UK allows traders to surreptitiously operate legally with low taxation. UK legislators recognise the enormous potential of the cryptocurrenciess industry and its projects and now the government, in consultation with the UK crypto community, is looking for solutions to fully regulate this market. Poland, on the other hand, is again acting against its citizens and instead of helping the developing industry, is tightening the regulations. This leads to the escape of both individual investors (traders) and crypto-currency exchanges from the Polish market.
Waiting for full regulation cryptocurrencies in the UK
CryptoUK, the association of seven major cryptocurrencies exchanges operating in the UK, is working intensively on full regulation of the cryptocurrency market in the UK. The work concerns security and clear regulations.
Due to the fact that digital projects are characterized by extraordinary dynamics of development, the law does not always keep up with them. An example is Poland, where the Ministry of Finance almost punishes investors for investing in cryptocurrencies, assuming in advance that every investor can be a criminal. CryptoUK wants legal regulations supervised by the Financial Conduct Authority (FCA), which is the equivalent of the Polish Financial Supervision Authority, because of its full powers to regulate the financial market and protect its customers. CryptoUK proposes that the FCA should take care of licensing by establishing transaction security requirements and protecting against money laundering. This is to enable the UK to lead the way in creating safe conditions for the development of digital projects. As is currently the case in Japan and Gibraltar.
Great Britain and the company for trading cryptocurrencies
The United Kingdom already offers market-friendly cryptocurrencies conditions, where you can easily settle your business and pay taxes. Polish traders have no choice but to take advantage of this situation and set up a limited company in the UK to conduct such activities. It is convenient because only one person is required to register such a company and there is no need to physically go to the UK.
One shareholder in a limited company may legally and profitably trade in crypto currencies and, what is more important, exchange them into FIAT currencies without any problems. Directors of such companies are entitled to a tax-free amount of 11850 pounds, and a shareholder of the company is entitled to pay out 2000 pounds annually as a dividend from the company’s profits.
Cryptocurrencies trade is taxed similarly to FIAT (fiduciary) currency trade, i.e. means of payment issued by the state, and in the case of a limited company, the limited liability company pays tax on profit. Currently CIT in the UK is 19%, but the British government has announced that it will be reduced to 17% in 2019.