Etienne Wong and Sarah Squires (Old Square Tax Chambers) consider the tax considerations concerning a Dubai property investment bought in bitcoin.
Question
My client Bob (domiciled and tax-resident in the UK) decided in September 2017 to invest in a property development in Dubai. The unique selling point of the development was that completed homes valued in US dollars would be sold (only) for bitcoin. The value of a two-bedroom apartment was (and remains) $350 000. In September 2017 one bitcoin translated into $4 375 which meant (assuming the exchange rate remained the same) the price for the apartment would be 80 bitcoins. Bob bought 80 bitcoins in 2017 for £280 000. The development has yet to complete. In early 2018 one bitcoin translates into $15 217. At this exchange rate the price of the apartment would be 23 (and not 80) bitcoins....
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Etienne Wong and Sarah Squires (Old Square Tax Chambers) consider the tax considerations concerning a Dubai property investment bought in bitcoin.
Question
My client Bob (domiciled and tax-resident in the UK) decided in September 2017 to invest in a property development in Dubai. The unique selling point of the development was that completed homes valued in US dollars would be sold (only) for bitcoin. The value of a two-bedroom apartment was (and remains) $350 000. In September 2017 one bitcoin translated into $4 375 which meant (assuming the exchange rate remained the same) the price for the apartment would be 80 bitcoins. Bob bought 80 bitcoins in 2017 for £280 000. The development has yet to complete. In early 2018 one bitcoin translates into $15 217. At this exchange rate the price of the apartment would be 23 (and not 80) bitcoins....
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