Is it Legal to Buy Bitcoin in the UK?
The Financial Conduct Authority (FCA) is the main financial authority in the United Kingdom. It regulates financial firms that provide services to consumers and maintains the integrity of financial markets in the UK. The FCA also focuses on regulating the performance of both retail and wholesale financial services firms.
The FCA checks UK-based crypto asset firms regarding their implementation of effective user oversight methods, such as the prevention of money laundering and terrorist financing. But the authority neither regulates nor banns Bitcoin and other cryptocurrencies in the country. This means you can legally buy Bitcoin in the United Kingdom. Yet, given the growing popularity of Bitcoin, it is likely that regulations around crypto assets could become stricter in the future.
Note that Bitcoin and other cryptocurrencies are treated as property in the UK, and operations with them involve tax implications. Also, HMRC(HM Revenue and Customs) can track transactions with digital currencies, as the authority has adata sharing programwith all UK-based cryptoexchanges.
There is no specific tax on Bitcoin in the UK. Instead, your cryptocurrency activities will be subject to either Capital Gains Tax or Income Tax. The tax to be paid will depend on the type of transaction you make with your electronic assets. If you are considered earning income, you will pay Income Tax. If you are considering receiving capital gains, you will deal with Capital Gains Tax.
You will pay Capital Gains Tax in the UK if you:
sell cryptofor GBP or other fiat currencies;
trade cryptocurrenciesfor cryptocurrencies (including stablecoins);
spend cryptoon services and goods;
gift crypto(unless you gift your crypto holdings to your spouse or civil partner).
You will pay Income Tax in the UK if you:
get paid in crypto;
earn rewards through crypto staking;
mine Bitcoin or another popular cryptocurrency;
receive crypto through AirDrop events.
Best Ways to Buy Bitcoin in the UK Safely
A pioneer among cryptocurrencies, Bitcoin (BTC) has been enjoying a first-mover advantage since its inception in 2008. It is the most recognizable electronic coin, and, despite omnipresent price movements, Bitcoin remains the most expensive crypto. With its incredible ROI of several thousand percent, BTC is a desirable investment instrument, and lots of people are interested in buying Bitcoin.
The best way to buy Bitcoin UK safely is by finding a well-regulated cryptocurrency exchange that supports Bitcoin trading. Changelly deserves the first consideration when you are sifting through places where to buy cryptocurrency for fiat money, such as pound sterling (GBP).
The Ultimate Crypto Exchange for Bitcoin Trades
Changelly is an all-in-one online crypto exchange that is designed with users’ convenience in mind. It is a leading trading platform where you can instantly buy Bitcoin, Ethereum, USD Coin, and hundreds of other popular cryptocurrencies, with incredibly low fees of up to0.25%. You can choose from several supported payment methods, such as a debit card, credit card, wire transfers, and others. Even if you are totally new to crypto trading, you can buy your first Bitcoin effortlessly in a matter of a few seconds.
Changelly provides safe and instantaneous crypto trades without revealing users' identities. We allow our users to pick the best possible rates by comparing offers from multiple reputable trading platforms, including Binance, Coinomi, and more. Effective consumer protection measures, such as no-deposit storage (no custody of your private keys), 2-factor authentication, and an HTTPS protocol, ensure completely secure Bitcoin trading.
Changelly also has dedicated mobile apps for Android and iOS smartphones for seamless Bitcoin exchanges on the go.
If you choose to purchase Bitcoin outside Changelly, make sure you do your research and thoroughly analyze trading platforms that get on your radar. The Internet brims with scam crypto projects that do not offer a secure environment for Bitcoin trading.
Other trading platforms are properly regulated; however, they do not offer adequate transaction fees, so Bitcoin trading with them is often worthless.
Also, pay attention that decentralized exchanges do not allow you to buy Bitcoin for fiat currency. Such trading platforms are only good for swapping one crypto coin for another.
Remember that buying Bitcoins is a chancy venture, and you put your initial investment at risk when you make crypto purchases. Cryptocurrencies are volatile assets, and the Bitcoin price can drop drastically within a short time. Crypto assets are unregulated investment products with no UK orEU investor protection. Also, before you buy Bitcoin in the UK, you need to set up a crypto wallet.
How to Buy Bitcoin with Credit and Debit Card
A credit or debit card allows you to buy Bitcoin instantly, provided you have found a credible crypto exchange that supports fiat-to-crypto purchases. Changelly is a trusted cryptocurrency exchange with on-ramp and off-ramp services, i.e. we let our users exchange fiat currency for Bitcoin (or any other popular cryptocurrency, such as Bitcoin Cash), as well as sell cryptocurrency back into fiat money. This is enabled thanks to our partnerships with prominent fiat-to-crypto providers: MoonPay, Simplex, and Switchere.
Buying Bitcoin with a bank card on Changelly is an extremely simple process and does not require any technical skills. However, to buy Bitcoin UK with MasterCard or VISA, you will first need to create a new account on Changelly (if you do not have any) and fulfill a Know Your Customer (KYC) procedure. This will commonly require providing your full name, a government-issued ID document, a current photo, a paid utility bill, and, sometimes, a bank statement.
Once your identity is verified (which commonly occurs quickly), you can proceed with buying Bitcoin with your credit or debit card. For this, you will need to navigate to the “Buy” page on the Changelly platform.
Select a fiat currency from the payment window (GBP, USD, EUR, etc.) to be exchanged for crypto and specify the amount of fiat
Next, pick the desired crypto from the menu (e.g., Bitcoin) and select the exchange rate from a list of offerings.
After that, input the details of your bank card and provide a Bitcoin wallet address where your digital coins will be sent. Note that credit card companies often charge additional deposit fees for such transactions.
Then you review the transaction draft, and if everything looks OK, you confirm the transfer, and it is processed instantly. As easy as that - you are all set to buy and sell Bitcoin.
On Changelly, you can buy Bitcoin in the UK with a debit or credit card instantly with no limits or excessive trading fees. Our platform cooperates with leading on-ramp & off-ramp providers that ensure super low fees for bank card payments. All of our partners also comply with stringent safety requirements to prevent any security-related issues.
How to Buy Bitcoin with Bank Transfer in the UK
On Changelly, you can buy Bitcoin in the UK by selecting a bank transfer among payment options. In the United Kingdom, many large banks permit fiat-to-crypto purchases, including Revolut, Nuri, and Royal Bank of Scotland (RBS) & NatWest to name a few.
Crypto purchases via bank wires are enabled on our platformthrough integrating SEPA(Single Euro Payments Area) Instant and UK Faster Payments. This makes it easier for our users in the United Kingdom and the European Economic Area (EEA) to transfer GBP and EUR between Changelly and their bank account.
A GBP bank transfer may take up to several business days to settle, although such transactions are commonly settled within one working day. As with a card purchase, buying Bitcoin via a bank transfer will first require completing a KYC requirement.
Bank transfers are some of the most convenient payment methods to deposit funds in your crypto exchange account. Be careful when configuring the order to ensure the funds are moved to the correct account. Depending on your bank, a deposit fee might be charged when you are buying Bitcoin in the UK through a wire transfer.
How to Buy Bitcoin with Apple Pay in the UK
Most cryptocurrency exchanges in the UK, including Changelly, will allow you to deposit funds on your crypto account using Apple Pay to buy Bitcoins safely from an iOS device.
To buy Bitcoin in the UK, you just need to get an account with a trusted Bitcoin exchange that supports Apple Pay payments. Make sure the platform of your selection has competitive fees, a broad selection of digital assets, and immediate order executions — Changelly offers all these features. Undergoing an identity verification procedure is required.
Then you need to deposit funds to your crypto account. For this, you sign in to your crypto account on a device that supports Apple Pay and then select your preferred payment method for sending fiat money. Funds will usually be credited to your exchange account momentarily.
Then you just go to the “Buy” section and start a Bitcoin purchase, following the guidance provided by the system.
How to Buy Bitcoin from ATM in the UK
According to a note published by the UK Financial Conduct Authority (FCA), on March 10, 2022, Bitcoin ATMs that allow individuals to buy and sell cryptocurrencies must be banned in the UK.
To operate legally, these crypto ATMs must be registered with the FCA and "comply with UK anti-money laundering regulations," but they often fail to do so. The regulator also states that these machines lack adequate background checks, and there is a raised concern that they could be used for illegal transactions.
Although FCA has revoked licenses from many Bitcoin ATM operators in the United Kingdom, an online service Coin ATM Radar says there are still 27 Bitcoin ATM installations working in major UK cities, including London, Manchester, Birmingham, and some others.
In order to buy Bitcoins using a crypto ATM, you basically need to find the closest machine to your location. With some possible variations, the general process of buying Bitcoin UK through an ATM will look like:
complete identity verification requested by a Bitcoin ATM (it is optional and may vary depending on machine type);
provide the Bitcoin wallet address for a deposit (make sure you have set up a crypto wallet and brought an address with you before using a machine);
deposit an amount of cash into the ATM slot;
review and confirm the transaction (the purchased Bitcoin will be instantly sent to the provided address).
Depending on the machine’s level of compliance with FCA, identity verification requirements, as well as deposit limits, may vary significantly.
How to Buy Bitcoin with PayPal
PayPal has recently enabled crypto purchases for its verified users. You can buy, sell, and hold coins and tokens right in your on-platform wallet through PayPal’s cryptocurrency service, but you cannot use it to send Bitcoin or another digital currency.
However, PayPal’s crypto service is not regulated by the UK FCA. Therefore, if something goes wrong with your crypto holdings when using PayPal, you cannot use any UK Financial Services Compensation Scheme. For this reason, PayPal is not among the popular payment methods for crypto purchases in the UK.
Buying Bitcoins with PayPal in the United Kingdom is possible in two ways: either through your PayPal dashboard (if you are a verified user of this platform), or through a special crypto exchange that accepts PayPal payments. But, you can take the lazy way out and buy Bitcoin UK on Changelly, using credit cards, debit cards, or bank transfers. These methods are utterly safe and ensure instant processing.
How to Buy Bitcoin UK with Prepaid Card
A prepaid card is essentially a debit card that already contains some money when you buy it. Prepaid cards are very useful as they let you put a cap on your expenses. Once the funds are exhausted, you usually need to refuel your card’s balance to continue spending.
To buy Bitcoin in the UK with a prepaid card, you just need to create and verify your account with an appropriate crypto exchange. Next, you go to the “Deposit page” and fund your account by linking your prepaid card as a preferred payment option.
Then you need to place a Bitcoin purchase order, specifying the amount of fiat money to spend, as well as the amount of crypto you wish to receive. Then you confirm the operation and navigate to your Bitcoin wallet and check the arrival of digital funds.
How to Buy Bitcoin with Cash in the UK
Lots of people are looking for ways to buy Bitcoin in the UK with cash, as they do not want to reveal their identities through KYC. Another reason for buying Bitcoin in cash is to avoid taxes. There are several ways how you can buy Bitcoins with cash, including:
Buying in-person. If you are acquainted with some trusted person who is willing to sell Bitcoin, you are all set. You can agree upon the place, date, and amount of cash with that person. When you two meet up, bring your smartphone or laptop, from which you can access your Bitcoin wallet. If you only bring your Bitcoin wallet address, you cannot verify the receipt of crypto assets.
Peer-to-peer trading. P2P is a popular scheme for buying and selling crypto. There are both cryptocurrency exchanges and special P2P marketplaces where you can trade electronic assets directly with other individuals.P2P platforms allow you to compare offers from around the world and select from dozens of payment methods in different local currencies, including GBP. P2P platforms also have an escrow mechanism that protects users from fraud by freezing a seller’s tokens until payment conditions are satisfied.
Cash deposits at a bank office. You can find a Bitcoin seller who will provide you with their bank account details, so you can go to a local bank office and pay cash over the counter. The bank will send a transfer to the bank account of a Bitcoin seller. Note that bank-deposit trades are carried out without escrowing, which may put you in trouble if the Bitcoin seller refuses to send crypto to your Bitcoin wallet address.
Can Foreigners Buy Bitcoin in the UK?
Basically, anybody can buy and sell Bitcoin in any area where cryptocurrency trading is not prohibited. Foreigners can buy Bitcoin in the United Kingdom, provided they are not residents of countries where cryptos are totally restricted (such as Algeria, Bangladesh, China, Iraq, and a few more).
Each crypto company will establish its own policy concerning serving non-UK residents. You may want to discuss this question with a customer support team of a particular crypto exchange before you make your first deposit of fiat money on this platform.
Who Accepts Bitcoin in the UK?
Bitcoin is the most widely recognized digital currency, and an increasing number of retailers and merchants are accepting it as a valid form of payment. From clothing and accessories to travel and accommodation, there are lots of ways to use your crypto assets apart from buying or selling Bitcoin.
Some of the most famous United Kingdom companies that accept Bitcoin payments include:
Lush — a cosmetics supplier;
Shopify — a provider of online e-commerce solutions;
Microsoft — a gigantic IT corporation offering different software products;
AFK Apparel — an online store offering clothes and accessories;
Bimble Solar — they sell solar panels and equipment;
C W Sellors — a famed UK-based jeweler;
Go City Hotels — a hotel booking service;
Green Man Gaming — a provider of the latest and greatest computer games.
By doing a little research, you discover that there are hundreds of companies in the UK that eagerly accept Bitcoin payments to cover your everyday consumer needs.
How to Sell Bitcoin in the UK?
Selling Bitcoin for cash is possible on online crypto exchanges with an off-ramp feature (the possibility of converting crypto assets back into fiat money). You can also use a Bitcoin ATM to convert your crypto holdings into cash if you cannot or are unwilling to use online Bitcoin exchanges.
To sell Bitcoin, you need to place a sell order through your crypto exchange, much like you did when you originally bought it. Most platforms offer different types of orders, so you can choose to sell only when Bitcoin reaches a specified price, or you can place an order that will execute at the current market price.
Selling Bitcoin Profitably
Changelly allows crypto-to-fiat transactions in the United Kingdom in GBP with fast withdrawals. Our service charges a total fee of 5%, and these are extremely low fees compared to other platforms in the market.
