PostedMon, 15 Apr 2024 08:16:20 GMTbyanderssummers
Good morning,I recently became aware that I owe tax for gains made using a crypt trading bot.The bot is a dollar cost averaging bot, which will split say £200 into £40 amounts, and buy as the crypto price falls. The bot then then sells when it reaches an average 2% profit.- Because of the high number of layers, in 20/21 the bots made about 17,000 transactions. Total gains were £26,487.- In 21/22, the bots made £9,393 in gains from 4,000 transactions.- in 22/23, the market fell heavily, and I made a loss of £35,680.As background, I am not a professional trader (I have a full time job); I would spend about an hour a day setting up the bots; I only used my own money, I don't have a business and nor a business plan. I only used the bots because I thought they would be safe to use. Many of the bot trades were within the same day, some over a few days, and a few over a number of months. I read somewhere that if you undertake a high number of transactions, this could be considered as "trading". I would like to know whether the gains from this type of bot are considered to be "trading" and hence subject to 40% income tax, or, if it would be considered capital gains, and subject to 20% capital gains tax over the allowance of £12,300.Thank you.
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