I'm asking this here despite the warnings because there are unanswerd questions regarding interest on crypto in the megathread. I understand if it gets removed but I don't know what else to do.
People asking about how interest on crypto are told it's a taxable event - treated by HMRC as an interest event.
If your interest is "in kind" - ie you receive interest in bitcoin on your bitcoin:
- Do you pay tax on the £ value of that bitcoin at the time it was received (sometimes weekly)
- If you dispose of any bitcoin (could be from another exchange) is your cost basis worked out as if each week you "bought" the interest at the price each week. - or is cost basis worked out as an average over the year or something - I can see the calculation getting pretty complicated as you have to pool interest payments with original purchases of bitcoin.
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