“A derivative is a financial instrument where the performance is based on the movement of the price of the underlying asset. Under a derivative the holder does not hold the underlying asset. Some businesses offer the ability for individuals and companies to gain exposure to the movements in the cryptoasset market by using a derivative. The nature of a derivative is typically very different to directly holding a cryptoasset. In particular, a derivative will give rise to contractual rights and obligations between the two parties. As a result, where a cryptoasset derivative has been entered into the guidance in this manual will not generally apply.”
CG56100 confirms that if the transactions are taxed as capital gains ‘all debits and credits to the account, including commission and sums equivalent to interest and dividends, are brought within the computation of the net chargeable gain or allowable loss when the contract is closed out’. It is not clear if the same costs can be deducted if it is treated as miscellaneous income.This guidance also goes on to state ‘Retail contracts for differences are financial futures, and, unless the profits are taxable as trading income, in almost every case Section 143 of TCGA92 charges the outcomes under the capital gains regime (CG56000+).