[benmmurphy]

that seems weird that germany has to recognize bitcoin as a unit of account to collect taxes on it. surely, if you buy something and then later sell it in the future for a profit you are liable for capital gains on it. surely there is not some massive whitelist of all the goods that attract capital gains tax.

[perlgeek]

There are extra taxes for trading with currencies in Germany (and other countries, it seems; google "forex tax"). So without it being recognized as a currency, you still have to pay VAT, but not forex tax.

[effn]

VAT is never charged on assets (which Bitcoin is), only goods and services.

[TomGullen]

Here in the UK Bitcoins are treated as an electronic service. This means once you're registered for VAT (and you must past ~£70k revenue) you have to charge VAT on sales to:

- Anyone in the UK

- Individuals in the EU

And:

- Reverse charge VAT to business in the EU

Having to charge VAT on Bitcoins is a show stopper if you're intending to sell them unless you close your doors to EU customers.

Bitcoins need to be classed as VAT exempt, or small business in the UK trying to get into Bitcoin will always struggle to grow.

[celticninja]

No they are not.

There is no official stance on bitcoin by the UK government, or tax authorities. VAT is not chargeable on bitcoin transactions. There was one gy who was advised by his accontants that he should be charging VAT but that was not a legal requirement, more his accoutnants taking a very risk averse position, that way if VAT was ever brought in on bitcoin he would not get an unexpected VAT bill.

There are There are also some goods and services that are 2 types of 'exemption' to VAT:

* exempt - so no VAT is charged on them

* outside the scope of the UK VAT system altogether

Bitcoin is outside the scope of VAT entirely and it would require the tax man/govt making a declaration on bitcoin as to how it is treated under VAT rules. This has not happened, therefore VAT is not applicable to bitcoin.

[celticninja]

I see you deleted your reply, I hope that does not prevent you from seeign that i did reply to it.

[justincormack]

That's not really true. VAT is no longer charged on gold coins for investment purposes since the EU made the UK change the law but it is not that clearcut.

[Uchikoma]

That's the whole point, bitcoin not being treated as a good you trade.

[claudius]

The way I understand it, this allows people/companies to do their accounting at least in parts in Bitcoin and then pay taxes (in Euros, of course) on the resulting revenue, rather than treating Bitcoins as goods that are sold/bought for ‘real’ money.

But I am neither an accountant, nor a lawyer, nor an economist, so the likelihood of my guess being correct is rather slim.

[celticninja]

not necessarily. If i buy a collectable trading card or spiderman comic and keep it for 3 years then decide to sell it, it usually will not attract capital gains tax. I am not equating bitcoin to collectables but the precedent is there. Additionally they (German govt/tax authorities) recently advised that you would be liable for capital gains tax on bitcoin profits if you held the bitcoins for less than 12 months, held for over 12 months and you do not have to pay tax on any gains. This appears to be in line with that earlier announcement.