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BittyTax

BittyTax is a collection of command-line tools to help you manage your cryptoasset accounts. Allowing you to audit, value and calculate your annual UK Capital Gains and Income Tax.

This tool is designed to be used by someone who is already familiar with cryptoasset taxation rules in the UK. HMRC recently published new guidance, some useful links are provided in the Resources section at the end.

BittyTax comprises of 3 different tools.

  1. bittytax - process transaction records, audit accounts, provide a tax summary for each year and display the current value of your cryptoasset portfolio (see Accounting Tool)

  2. bittytax_conv - converts data files from many different wallets and exchanges into the bittytax transaction record format (see Conversion Tool)

  3. bittytax_price - lookup historic price data for cryptoassets and foreign currencies (see Price Tool)

Disclaimer

This software is copyright (c) Nano Nano Ltd, and licensed for use under the AGPLv3 License, see LICENSE file for details.

Nano Nano Ltd does not provide tax, legal, accounting or financial advice. This software and its content are provided for information only, and as such should not be relied upon for tax, legal, accounting or financial advice.

You should obtain specific professional advice from a professional accountant, tax or legal/financial advisor before you take any action.

This software is provided 'as is', Nano Nano Ltd does not give any warranties of any kind, express or implied, as to the suitability or usability of this software, or any of its content.

Getting Started

Prerequisites

You need to have Python 2.7 or 3.x installed on your machine before you can install BittyTax. MacOS and most Linux distributions already come with Python pre-installed.

If you need to install Python we recommend you install Python 3.x, see https://wiki.python.org/moin/BeginnersGuide/Download for instructions.

Note: BittyTax is currently in Beta version (see the CHANGELOG file for details) it has been tested on MacOS and Windows 10, using both Python 2.7, and Python 3.7.

Installing

To install the latest release:

    $ pip install BittyTax

or download the ZIP file, unpack, navigate to the top level of the repository and install using:

    $ python setup.py install

Note: This will install the latest unreleased version which may include untested changes, check the CHANGELOG.

Upgrade

To upgrade to the latest release:

    $ pip install --upgrade BittyTax

Transaction Records

BittyTax is only as accurate as the data you provide it, it is essential that you keep records of ALL cryptoasset transactions - not just trades but also records of spending, gifts send and received, etc.

The bittytax_conv tool is provided to assist with this transaction record keeping, it allows data exported from various different wallets and exchanges to be processed into the format required by the bittytax accounting tool. Manual entry or editing of this data may also be required and it is vital that any exported data which has been converted is reviewed and audited before use.

The file should be in CSV (comma-separated values) format and each row should contain the following fields.

Field Type Description
Type Deposit Tokens deposited to a wallet you own
Mining Tokens received as income from mining
Income Tokens received as other income
Gift-Received Tokens received as a gift
Withdrawal Tokens withdrawn from a wallet you own
Spend Tokens spent on goods or services
Gift-Sent Tokens sent as a gift
Charity-Sent Tokens sent to a charity as a gift
Trade Tokens exchanged for another token or fiat currency
Buy Quantity Quantity of the asset acquired
Buy Asset Symbol name of the asset acquired
Buy Value Value in UK pounds (GBP) of the asset acquired
Sell Quantity Quantity of the asset disposed
Sell Asset Symbol name of the asset disposed
Sell Value Value in UK pounds (GBP) of the asset disposed
Fee Quantity Quantity of the fee
Fee Asset Symbol name of the asset used for fees
Fee Value Value in UK ponds (GBP) of the fee
Wallet Name of wallet
Timestamp Date/time of transaction

The transaction Type dictates which fields in the row are required, either (M)andatory or (O)ptional.

Type Buy Quantity Buy Asset Buy Value Sell Quantity Sell Asset Sell Value Fee Quantity Fee Asset Fee Value Wallet Timestamp
Deposit M M O O O M
Mining M M O O O O O M
Income M M O O O O O M
Gift-Received M M O O O O O M
Withdrawal M M O O O M
Spend M M O O O O O M
Gift-Sent M M O O O O O M
Charity-Sent M M O O O O O M
Trade M M O M M O O O O O M
  • If fees are specified, the Buy or Sell Quantity should be the net amount (i.e. prior to any fee adjustment).

  • The Buy Value, Sell Value and Fee Value fields are always optional, if you don't provide a fixed value, bittytax will calculate the value via one of it's price data sources.

  • Wallet name is optional, but recommended if you want to audit your cryptoasset balances across multiple wallets.

  • Timestamp should be in the format YYYY-MM-DDTHH:MM:SS ZZZ, recognised timezones (ZZZ) are GMT, BST and UTC.

  • Cryptoasset symbol names need to be consistent throughout your transaction records. For example, Bitcoin Cash was referred to as both BCC and BCH at the time of the first fork, but also more recently as BCHABC or BAB. The symbol name you choose should match the symbol name used by the price data source, otherwise valuations will fail, see Price Tool for more information.

  • Transaction records can be listed in any order, bittytax will sort them by Timestamp before processing.

An example transaction record file is included here.

Deposit

A Deposit is a transfer transaction record, indicating the receipt of cryptoasset tokens to a wallet you control. For example, you might have deposited tokens to a wallet on an exchange, ready to be traded.

Deposit should NOT be used to record transfers to someone else's wallet, this would be categorised as either a Gift-Sent or a Spend.

There should be an equivalent Withdrawal transaction record for every deposit, since tokens are always moving out of one wallet into another. The quantity of tokens deposited will normally be less than the quantity withdrawn due to network transaction fees. Deposits and Withdrawals are not taxable events.

The Deposit type can also be used to record fiat deposits into an exchange, although this is not used for tax calculations it will be used for auditing purposes.

Withdrawal

A Withdrawal is a transfer transaction record, it indicates tokens being sent from a wallet you control. It is always used in combination with a Deposit transaction.

The Withdrawal type can also be used to record fiat withdrawals from an exchange.

Mining

The Mining transaction type is used to identify tokens received as income from mining. The Income transaction type could also be used to record this, it's use is purely descriptive.

These transaction records will appear within your income tax report.

Income

The Income transaction type is used to identify tokens received as other income.

These transaction records will appear within your income tax report.

Gift-Received

The gift-received transaction type is used to record cryptoasset tokens received as a gift.

A gift received is not taxed as income.

Spend

A Spend is a disposal transaction record, it's used to capture the spending of tokens on goods or services.

As a disposal transaction, it is applicable for Capital Gains tax.

Gift-Sent

A Gift-Sent is a disposal transaction record, it identifies cryptoasset tokens sent as a gift.

As a disposal transaction, it is applicable for Capital Gains tax.

Charity-Sent

A Charity-Sent is a disposal transaction record, it identifies cryptoasset tokens sent to a charity as a gift. It's handling is the same as a Gift-Sent, it's purpose is purely descriptive.

Trade

The Trade transaction type records the exchange of one cryptoasset for another, or for fiat currency.

This could be for one for the following reasons.

  • Fiat-to-crypto (acquisition)
  • Crypto-to-crypto (disposal)
  • Crypto-to-fiat (disposal)

In the case of a fiat-to-crypto trade, the Sell Asset would be fiat, i.e. GBP, or whatever currency you used, and Sell Quantity would contain the amount. There is no reason to specify the Sell Value if the currency is GBP.

In the opposite case, crypto-to-fiat, the Buy Asset would be fiat, and the Buy Quantity the amount in fiat.

Trades which are a disposal are applicable for Capital Gains tax.

Other types?

Below is a list of some other situations which you might need to record, but which don't have a specific transaction type defined. These could be added in the future if users feel it would be beneficial.

  1. Airdrop - These tokens can be recorded as either a Gift-Received, if nothing was done in return for them, or Income if the distribution of tokens was dependant upon providing a service or other conditions, see HMRC Guidance on Airdrops.
  2. Dust clean - Some exchanges remove very small amounts (dust) of cryptoasset tokens from their wallets after a period of time, since these are too small to be traded or withdrawn. This can be captured as a Spend with a Sell Value of 0.
  3. Fork - If a cryptoasset you own forks, the new cryptoasset tokens created can be recorded as a Gift-Received but with a Buy Value of 0. This assumes that you are not splitting the cost between the original and new cryptoasset. Currently it is not possible to derive a cost from the original cryptoasset and apportion this to the new one. See HMRC Guidance on Blockchain forks.
  4. Gift to spouse - If cryptoasset tokens are gifted to your spouse, it can be recorded as a Gift-Sent but with a Sell Value of 0.
  5. Margin funding - Tokens received from an exchange in return for margin funding can be captured as Income.
  6. Lost - Tokens which have been lost, i.e. the private keys are unrecoverable, have to be reported/accepted by HMRC as a "negligible value claim". These are treated as a disposal, followed by a re-acquisition for the amount lost, since technically you still own the cryptoasset. This can be recorded as a crypto-to-fiat Trade with a GBP cost of 0, followed by a fiat-to-crypto Trade for exactly the same quantity of the cryptoasset, also with a cost of 0.
  7. Staking - Tokens received from Proof of Stake (POS) can be recorded as Mining or Income.

Excel

You can use an application such as MS Excel to compile and edit your transaction records. These can then be exported as a CSV file and loaded into the bittytax accounting tool.

If you do use Excel, there are some pitfalls to be aware of.

  1. "Although Excel can display 30 decimal places, its precision for a specified number is confined to 15 significant figures". If, for example you add the number 1184.210334916848655 to a cell, Excel will truncate this to 1184.21033491684, which is 15 significant figures. This truncation might not be significant from a tax perspective but will cause your accounts not to balance correctly.

  2. When you save a worksheet as a CSV file, the numbers saved are those as displayed by the formatting, which might be truncated, not the actual number you see if click on the cell to edit it.

One way to avoid these issues is to format all cells as Text. Instead of opening a CSV file directly into Excel, it's better to open Excel and use File > Import, follow the steps of the Text Import Wizard, and when selecting the Data Format, be sure to select Text for all the columns.

The conversion tool will display a warning if it detects any data which exceeds 15-digits of precision.

Accounting Tool

Once you have all of your transaction records stored in a CSV file you can use bittytax to process them.

bittytax <filename>

There are additional command line arguments which you can use, to see all these use the help command.

bittytax --help

The -ty or --taxyear argument tells bittytax to only output a tax summary for the year you specify, by default tax summaries will be produced for all years which contain taxable events.

bittytax <filename> -ty 2019

You can turn on debug using the -d or --debug command argument, this causes bittytax to produce detailed logging of the transaction records, the audit and tax calculations.

The accounting tool performs these functions in the order below:

  1. Import transaction records
  2. Audit
  3. Pool same day
  4. Match "same day" rule
  5. Match "bed and breakfast" rule
  6. Process unmatched (Section 104)
  7. Process income
  8. Tax summary report (for each year)
  9. Current holdings report

Import Transaction Records

Firstly the transaction records are imported, and then validated according to their transaction type, making sure the correct mandatory and optional fields are included.

Fees

As part of the import process the buy and sell quantities are adjusted by any fees. Bittytax does not account for fees separately.

The fee asset type has to match that of the buy or the sell.

Logging

If you enable debug logging you will be able to check that bittytax has correctly interpreted your transaction records from the CSV file.

All timestamps of the transactions are normalised to be in local time (GMT or BST), this is required for the tax calculations to be correct (i.e. same day rule).

As you can see in the sample below, the row number from the file is indicated, also any optional value fields specified are shown in brackets after the quantity and asset. The quantity will show for any fee adjustment.

INFO -- : ==IMPORT TRANSACTION RECORDS==
DEBUG -- : [Row:1] Deposit: 870 GBP "LocalBitcoins" 2013-05-24T21:16:46 BST
DEBUG -- : [Row:2] Trade: 10 BTC <- 870 GBP "LocalBitcoins" 2013-05-24T21:17:40 BST
DEBUG -- : [Row:3] Withdrawal: 10 BTC "LocalBitcoins" 2013-05-24T21:20:49 BST
DEBUG -- : [Row:4] Deposit: 10 BTC "Desktop wallet" 2013-05-24T21:20:49 BST
DEBUG -- : [Row:5] Spend: 0.002435 BTC (£0.80 GBP) "Desktop wallet" 2014-06-26T12:25:02 BST
DEBUG -- : [Row:6] Deposit: 2,693.8 USD "Bitstamp" 2014-05-29T09:33:00 BST
DEBUG -- : [Row:7] Gift-Sent: 0.02757 BTC "Desktop wallet" 2014-07-18T14:12:47 BST
DEBUG -- : [Row:8] Trade: 0.41525742 BTC <- 258.82 USD "Bitstamp" 2014-07-23T11:58:00 BST
DEBUG -- : [Row:9] Trade: 0.58474258 BTC <- 364.45 USD "Bitstamp" 2014-07-23T11:58:00 BST

Audit

The audit function takes the raw transaction records, sorts them by timestamp, and then replays them in chronological order.

The simulation of tokens (and also fiat) being moved between your wallets allows you to compare the final audit balances against your real wallets and exchange balances.

INFO -- : ==FINAL AUDIT BALANCES==
INFO -- : Bitstamp:BTC=0
INFO -- : Bitstamp:USD=0
INFO -- : Coinfloor:BTC=0
INFO -- : Coinfloor:GBP=0
INFO -- : Desktop wallet:BTC=13.11024863
INFO -- : LocalBitcoins:BTC=0
INFO -- : LocalBitcoins:GBP=0
INFO -- : Poloniex:BTC=2.89354264
INFO -- : Poloniex:ETH=248.60854866
INFO -- : Poloniex:XRP=19,037.77593453

If they don't match, it could be that your transaction records are incomplete.

Bittytax will raise a warning if a cryptoasset balance goes negative, this could happen if the time ordering of your transactions is not accurate.

If you do get issues, you can turn on debug to produce detailed logging of the audit, so you can see the impact that each individual transaction has on a wallet.

In the debug example below, you can see each line shows the wallet name, it's asset, followed by the new balance, and in brackets the quantity that was added or subtracted.

DEBUG -- : ==FULL AUDIT TRANSACTIONS==
...
DEBUG -- : [Row:8] Trade: 0.41525742 BTC <- 258.82 USD "Bitstamp" 2014-07-23T11:58:00 BST
DEBUG -- : Bitstamp:BTC=0.41525742 (+0.41525742)
DEBUG -- : Bitstamp:USD=2,434.98 (-258.82)
DEBUG -- : [Row:9] Trade: 0.58474258 BTC <- 364.45 USD "Bitstamp" 2014-07-23T11:58:00 BST
DEBUG -- : Bitstamp:BTC=1 (+0.58474258)
DEBUG -- : Bitstamp:USD=2,070.53 (-364.45)
DEBUG -- : [Row:10] Trade: 0.86 BTC <- 523.67 USD "Bitstamp" 2014-07-24T14:08:00 BST
DEBUG -- : Bitstamp:BTC=1.86 (+0.86)
DEBUG -- : Bitstamp:USD=1,546.86 (-523.67)
DEBUG -- : [Row:11] Trade: 0.9 BTC <- 548.21 USD "Bitstamp" 2014-07-24T14:08:00 BST
DEBUG -- : Bitstamp:BTC=2.76 (+0.9)
DEBUG -- : Bitstamp:USD=998.65 (-548.21)
DEBUG -- : [Row:12] Trade: 1.64037953 BTC <- 998.65 USD "Bitstamp" 2014-07-24T14:09:00 BST
DEBUG -- : Bitstamp:BTC=4.40037953 (+1.64037953)
DEBUG -- : Bitstamp:USD=0 (-998.65)
DEBUG -- : [Row:13] Withdrawal: 4.40037953 BTC "Bitstamp" 2014-07-24T22:01:00 BST
DEBUG -- : Bitstamp:BTC=0 (-4.40037953)

Although important, the audit function can be disabled using the -s or --skipaudit command argument to speed up the tax reporting.

Pool Same Day

HMRC stipulates that "All shares of the same class in the same company acquired by the same person on the same day and in the same capacity are treated as though they were acquired by a single transaction" this applies in the same way to disposals.

Splitting Transactions

Before the pooling of cryptoassets can occur, transaction records need to be split into Buy (acquisition) and Sell (disposal) transactions.

For Trade transaction records that are crypto-to-crypto, this will result in two transactions being generated, one for the buy asset and another for the sell.

It's during this splitting of transaction records that each transaction is given a value, if not already specified. Its cost in UK pounds (GBP) is calculated via one of the different price data sources, see Price Tool for how.

What we are left with, is only cryptoasset transactions, Buys or Sells. Fiat assets are dropped, since these are now incorporated into the transactions cost.

Pooling

Tokens of the same cryptoasset, acquired on the same day, are pooled together into a single Buy transaction, the same applies for tokens disposed of on the same day. These are pooled into a single Sell transaction.

Deposit and Withdrawal transactions are not included within these pools as they are not taxable events.

Logging

By enabling debug logging you can check that transaction records have been correctly split into Buys and Sells, the correct price data sources have been used, and same day transactions have been pooled.

TID is Transaction ID, it matches the row number from your CSV file for traceability.

DEBUG -- : ==SPLIT TRANSACTION RECORDS==
DEBUG -- : [TID:2] Buy (Trade): 10 BTC (£870.00 GBP) "LocalBitcoins" 2013-05-24T21:17:40 BST
DEBUG -- : [TID:3] Sell (Withdrawal): 10 BTC "LocalBitcoins" 2013-05-24T21:20:49 BST
DEBUG -- : [TID:4] Buy (Deposit): 10 BTC "Desktop wallet" 2013-05-24T21:20:49 BST
DEBUG -- : Using fixed value, 0.002435 BTC=£0.80 GBP
DEBUG -- : [TID:6] Sell (Spend): 0.002435 BTC (£0.80 GBP) "Desktop wallet" 2014-06-26T12:25:02 BST
DEBUG -- : Price on 2014-07-18, 1 BTC=367.655 GBP via CoinDesk (Bitcoin)
DEBUG -- : Price on 2014-07-18, 1 BTC=£367.66 GBP, 0.02757 BTC=£10.14 GBP
DEBUG -- : [TID:7] Sell (Gift-Sent): 0.02757 BTC (£10.14 GBP) "Desktop wallet" 2014-07-18T14:12:47 BST
DEBUG -- : Price on 2014-07-23, 1 USD=0.5873004085 GBP via ExchangeRatesAPI (Fiat)
DEBUG -- : Price on 2014-07-23, 1 USD=£0.59 GBP, 258.82 USD=£152.01 GBP
DEBUG -- : [TID:8] Buy (Trade): 0.41525742 BTC (£152.01 GBP) "Bitstamp" 2014-07-23T11:58:00 BST
DEBUG -- : Price on 2014-07-23, 1 USD=0.5873004085 GBP via ExchangeRatesAPI (Fiat)
DEBUG -- : Price on 2014-07-23, 1 USD=£0.59 GBP, 364.45 USD=£214.04 GBP
DEBUG -- : [TID:9] Buy (Trade): 0.58474258 BTC (£214.04 GBP) "Bitstamp" 2014-07-23T11:58:00 BST

Pooled transactions are indicated by the transaction count at the end, shown within square brackets. The transactions contained within the pool are indented below it.

DEBUG -- : ==POOL SAME DAY TRANSACTIONS==
DEBUG -- : [TID:2] Buy (Trade): 10 BTC (£870.00 GBP) "LocalBitcoins" 2013-05-24T21:17:40 BST
DEBUG -- : [TID:3] Sell (Withdrawal): 10 BTC "LocalBitcoins" 2013-05-24T21:20:49 BST
DEBUG -- : [TID:4] Buy (Deposit): 10 BTC "Desktop wallet" 2013-05-24T21:20:49 BST
DEBUG -- : [TID:6] Sell (Spend): 0.002435 BTC (£0.80 GBP) "Desktop wallet" 2014-06-26T12:25:02 BST
DEBUG -- : [TID:7] Sell (Gift-Sent): 0.02757 BTC (£10.14 GBP) "Desktop wallet" 2014-07-18T14:12:47 BST
DEBUG -- : [TID:8] Buy (Trade): 1 BTC (£366.05 GBP) "Bitstamp" 2014-07-23T11:58:00 BST [2]
DEBUG -- :   [TID:8] Buy (Trade): 0.41525742 BTC (£152.01 GBP) "Bitstamp" 2014-07-23T11:58:00 BST
DEBUG -- :   [TID:9] Buy (Trade): 0.58474258 BTC (£214.04 GBP) "Bitstamp" 2014-07-23T11:58:00 BST

Match "same day" Rule

See "The “same day” rule TCGA92/S105(1)".

This tax function matches any Buy and Sell transactions, of the same cryptoasset, that occur on the same day.

If the buy and sell quantities do not match, the transaction with the larger quantity will be split into two, and the cost apportioned between them.

This allows a profit, or a loss, to be calculated for the matching transactions, and the transaction containing the remainder to be carried forward, and used in further calculations.

Logging

With debug enabled you can see which transactions have been "Same Day" matched, and where a Buy or Sell has been split.

Any new transactions created for splits are allocated with the original TID but with a decimal point separating it's unique ID, starting from 1.

DEBUG -- : ==MATCH SAME DAY TRANSACTIONS==
DEBUG -- : [TID:40] Sell (Charity-Sent): 5 BTC (£13,290.24 GBP) "Desktop wallet" 2017-08-08T19:37:20 BST
DEBUG -- : [TID:39] Buy (Gift-Received): 0.24 BTC (£637.93 GBP) "Desktop wallet" 2017-08-08T14:21:29 BST (Same Day)
DEBUG -- : split: [TID:40] Sell (Charity-Sent): 0.24 BTC (£637.93 GBP) "Desktop wallet" 2017-08-08T19:37:20 BST
DEBUG -- : split: [TID:40.1] Sell (Charity-Sent): 4.76 BTC (£12,652.31 GBP) "Desktop wallet" 2017-08-08T19:37:20 BST
DEBUG -- :  Gain=£0.00 (£637.93 - £637.93)

Match "bed and breakfast" Rule

See "The “bed and breakfast” rule TCGA92/S106A(5) and (5A)".

This tax functions matches sells to buybacks of the same cryptoasset which occur within 30 days.

As with the "same day" rule, if the buy and sell quantities do not match, the transactions will be split.

Transactions are sorted by timestamp, and matched in chronological order.

Any matched "same day" transactions are excluded from this rule.

Logging

With debug enabled you can see which transactions have been matched by the "Bed & Breakfast" rule, and the number of days between the Sell and Buy back.

DEBUG -- : ==MATCH BED & BREAKFAST TRANSACTIONS==
DEBUG -- : [TID:6] Sell (Spend): 0.002435 BTC (£0.80 GBP) "Desktop wallet" 2014-06-26T12:25:02 BST
DEBUG -- : [TID:8] Buy (Trade): 1 BTC (£366.05 GBP) "Bitstamp" 2014-07-23T11:58:00 BST [2] (Bed & Breakfast, 27 days)
DEBUG -- : split: [TID:8] Buy (Trade): 0.002435 BTC (£0.89 GBP) "Bitstamp" 2014-07-23T11:58:00 BST [2]
DEBUG -- : split: [TID:8.1] Buy (Trade): 0.997565 BTC (£365.16 GBP) "Bitstamp" 2014-07-23T11:58:00 BST [2]
DEBUG -- :  Gain=£-0.09 (£0.80 - £0.89)

Process Unmatched (Section 104)

Any transactions which remain unmatched are processed according to Section 104 Taxation of Capital Gains Act 1992.

Each cryptoasset is held in it's own pool, known as a Section 104 holding, the unmatched transactions are processed in chronological order.

As tokens are acquired, the total cost for that cryptoasset holding increases.

If all tokens in a holding are disposed of, the cost will be the total cost of that cryptoasset holding.

If only some tokens are disposed of, the cost is calculated as a fraction of the total cost. This fraction is calculated by the number of tokens disposed of, divided by the total number of tokens held.

The profit or loss, is then calculated by subtracting this cost from the proceeds of the disposal.

The transfer transactions, Withdrawal and Deposit, are not taxable. The tokens are removed, and then re-added to the holding, but at zero cost.

NOTE: It is important that no disposal event happens to a holding between a Withdrawal and a Deposit. This is because the tokens are removed temporarily, so would impact the cost calculation. The ordering of transactions can be checked in the debug log.

Logging

Before the Section 104 calculations, all the updated transactions are displayed for clarity, this includes any new "split" transactions which have been added by the matching function. This output is sorted by asset and timestamp.

The transactions which have been matched, and so excluded from the Section 104 holding, are denoted with (M) at the end.

DEBUG -- : ==UPDATED TRANSACTIONS==
DEBUG -- : [TID:2] Buy (Trade): 10 BTC (£870.00 GBP) "LocalBitcoins" 2013-05-24T21:17:40 BST
DEBUG -- : [TID:3] Sell (Withdrawal): 10 BTC "LocalBitcoins" 2013-05-24T21:20:49 BST
DEBUG -- : [TID:4] Buy (Deposit): 10 BTC "Desktop wallet" 2013-05-24T21:20:49 BST
DEBUG -- : [TID:6] Sell (Spend): 0.002435 BTC (£0.80 GBP) "Desktop wallet" 2014-06-26T12:25:02 BST (M)
DEBUG -- : [TID:7] Sell (Gift-Sent): 0.02757 BTC (£10.14 GBP) "Desktop wallet" 2014-07-18T14:12:47 BST (M)
DEBUG -- : [TID:8] Buy (Trade): 0.002435 BTC (£0.89 GBP) "Bitstamp" 2014-07-23T11:58:00 BST [2] (M)
DEBUG -- : [TID:8.1] Buy (Trade): 0.02757 BTC (£10.09 GBP) "Bitstamp" 2014-07-23T11:58:00 BST [2] (M)
DEBUG -- : [TID:8.2] Buy (Trade): 0.969995 BTC (£355.07 GBP) "Bitstamp" 2014-07-23T11:58:00 BST [2]

With debug enabled you can see detailed logging of the unmatched transactions being processed, and the impact it has on the individual holding.

Below each transaction it shows the cryptoasset holding, and by what amount the token and cost totals are being updated.

When a disposal takes place, indicated at the end of the transaction, the gain calculation is then shown below.

DEBUG -- : ==PROCESS UNMATCHED TRANSACTIONS==
...
DEBUG -- : [TID:18] Buy (Trade): 843.00981977 ETH (£1,474.70 GBP) "Poloniex" 2016-01-27T22:09:19 GMT [5]
DEBUG -- : ETH=843.00981977 (+843.00981977) £1,474.70 GBP (+£1,474.70 GBP)
DEBUG -- : [TID:23] Sell (Trade): 843.00981977 ETH (£1,471.33 GBP) "Poloniex" 2016-01-29T14:12:31 GMT [9] (Disposal)
DEBUG -- : ETH=0 (-843.00981977) £0.00 GBP (-£1,474.70 GBP)
DEBUG -- :  Gain=£-3.37 (£1,471.33 - £1,474.70)

Process Income

The function searches through all the original transactions, and records any that are applicable for income tax. Currently this is only the Mining and Income transaction types.

These are then output in the tax summary report.

Tax Summary Report

Once all the tax calculations are complete, the results are displayed either for all years, or for the tax year you specified via the command argument.

All cryptoasset disposals are listed in date order, for a "bed and breakfast" disposal, the date of the buyback is shown in brackets.

Enough information is provided for you to complete the "Other property, assets and gains" section within your self assessment tax return, or to give to your accountant to complete.

The capital gains tax figure is shown purely as an estimate, at the 20% rate. Obviously you would need to take into account other capital gains/losses in the same year, and use the correct tax rate according to your income.

The reporting function will raise a warning if the disposal proceeds exceed more than 4 times the annual allowance for that tax year, as you can see in the example report below. HMRC requires you to report this in your self assessment even if the gain was within your annual allowance.

Lastly, all income events are listed in date order for that year, along with the income total. You should check with an accountant for how this should be reported according to your personal situation.

INFO -- : ==TAX SUMMARY 2017/2018==
INFO -- : --CAPITAL GAINS--
INFO -- : Asset   Date       Disposal Type                                 Quantity          Cost      Proceeds          Gain
INFO -- : BTC     12/04/2017 Bed & Breakfast (10/05/2017)                    1.0003     £1,358.61       £969.91      £-388.70
INFO -- : BTC     12/04/2017 Section 104                                 8.29479379     £1,391.52     £8,042.80     £6,651.28
INFO -- : BTC     08/08/2017 Same Day                                          0.24       £637.93       £637.93         £0.00
INFO -- : BTC     08/08/2017 Section 104                                       4.76       £798.53    £12,652.31    £11,853.78
INFO -- : BTC     09/09/2017 Section 104                                 0.99999993       £167.76     £3,251.91     £3,084.15
INFO -- : BTC     24/12/2017 Bed & Breakfast (02/01/2018)                         2    £21,692.50    £20,086.56    £-1,605.94
INFO -- : XRP     01/04/2018 Bed & Breakfast (05/04/2018)              914.84163064       £146.96       £312.16       £165.20
INFO -- : XRP     01/04/2018 Section 104                             1,085.15836936       £175.36       £370.28       £194.92
INFO -- : Number of disposals=8
INFO -- : Disposal proceeds=£46,323.86
WARNING -- : Assets sold are more than 4 times the annual allowance (£45,200.00), this needs to be reported to HMRC
INFO -- : Allowable costs=£26,369.17
INFO -- : Gains in the year=£19,954.69
INFO -- : Losses in the year=£0.00
INFO -- : --TAX ESTIMATE--
INFO -- : Taxable Gain=£8,654.69 (-£11,300.00 tax-free allowance)
INFO -- : Capital Gains Tax=£1,730.94 (20%)
INFO -- : --INCOME--
INFO -- : Asset   Date       Income Type                                   Quantity        Amount
INFO -- : BTC     10/05/2017 Income                                          1.0003     £1,358.61
INFO -- : BTC     02/01/2018 Mining                                            12.5   £135,578.11
INFO -- : Total income=£136,936.72

Current Holdings Report

The current holdings report lists all your remaining cryptoasset balances with their current valuation.

By default, empty wallets are excluded, this setting can be changed in the config file, see Config.

The data source used for the current price is the same as used for historic prices, see Price Tool.

INFO -- : ==CURRENT HOLDINGS==
INFO -- : Asset                    Quantity          Cost         Value  Data Source
INFO -- : BTC                   16.00379127   £114,261.62   £101,210.84  CoinDesk (Bitcoin)
INFO -- : ETH                  248.60854866     £9,012.71    £50,217.50  CryptoCompare (Ethereum)
INFO -- : XRP               19,037.77593453     £3,076.55     £6,009.08  CryptoCompare (XRP)
INFO -- : Total cost=£126,350.88
INFO -- : Total value=£157,437.42

Notes:

Rounding

Prices used for tax calculations are rounded to two decimal places, using "Round half to even", for the following.

  1. When a value is assigned to a transaction (see Splitting Transactions)
  2. The cost apportioned when a transaction is split into two, during the matching process (see Match "same day" Rule)
  3. The fractional cost calculated for a part-disposal of a cryptoasset (see Process Unmatched)

Conversion Tool

The bittytax conversion tool bittytax_conv provides an easy way to convert your data files exported from various different wallets and exchanges into the transaction record format required by bittytax.

Wallets:

  • Electrum
  • Ledger Live
  • Qt Wallet (i.e. Bitcoin Core)
  • Trezor

Exchanges:

  • Binance
  • Bitfinex
  • Bitstamp
  • Bittrex
  • ChangeTip
  • Circle
  • Coinbase
  • Coinbase Pro
  • Coinfloor
  • Cryptopia
  • Cryptsy
  • Gatehub
  • HitBTC
  • KuCoin
  • OKEx
  • Poloniex
  • TradeSatoshi
  • Uphold
  • Wirex

Explorers:

  • Etherscan

Usage

The help command displays a full list of all currently supported data file formats as well as details of all command line arguments.

bittytax_conv --help

To use the conversion tool (assuming you've already exported the data), just pass the data filename as a command argument, it's also possible to pass multiple files by listing them in sequence. These files can be comma-separated values (.csv) format or MS Excel (.xls and .xlsx), both are recognised by the tool.

bittytax_conv <filename> [<filename> ...]

The tool will analyse the data file and try and match it against the list of recognised formats. If a match is successful the data file will be converted into the bittytax transaction record format. These new CSV records are output to the terminal window but can also be captured in a file using the redirection operator as shown in the example below.

bittytax_conv Coinbase-TransactionsReport.csv > transaction_records.csv

For wallet data files, transactions will only be categorised as the types - deposit or withdrawal, it's then up to you to manually correct them as spends, gifts, income, etc.

Some wallet exports do not specify the cryptoasset being used. For these the -ca or --cryptoasset command argument can be used to manually specify the asset.

bittytax_conv -ca BTC <filename>

Recap

The conversion tool also allows you to convert your wallet and exchange data files into the import CSV format used by Recap (see https://help.recap.io/en/articles/2631702-importing-csvs-into-custom-accounts). This requires the --format command option to be added as shown below.

bittytax_conv --format RECAP <filename>

Verify

It's important to verify the data generated by the converter tool is correct, there are a couple of ways to help you do this.

Append

The -a or --append argument causes the conversion tool to output the original data appended to the transaction record data. This provides a record of the mapping and makes it easier to spot any mistakes.

The appended data format can also be used by the bittytax tool, the additional data is just ignored.

Piping

Another useful tool to use when you are building up your history of transaction records, is to pipe the output of the conversion tool straight into bittytax.

bittytax_conv <filename> | bittytax

This will instantly show you what the remaining balance of each asset should be for that particular wallet or exchange. Bear in mind that in a minority of cases (I will try and list them below) the exchange data provided does not balance exactly. This is probably due to the rounding used in the export file being different to that used internally by the exchange.

Notes:

  1. Some exchanges only allow the export of trades, this means transaction records of deposits and withdrawals will have to be created manually, otherwise the assets will not balance.
  2. Bitfinex - when exporting your data, make sure the "Date Format" is set to "DD-MM-YY" which is the default.
  3. ChangeTip - the conversion tool requires your username(s) to be configured, this is to identify which transactions are a gift received or a gift sent, (see Config).
  4. Coinbase - has many different export formats, bittytax recognises the "Transactions history" and "Buys, sells, and merchant payouts" reports (also known as "Transfers"). Coinbase provides these reports for each individual wallet (both fiat and crypto). It's possible to end up with duplicate transaction records (i.e. one for the GBP wallet and another for the BTC wallet), these have to be filtered manually, the converter will flag some of these duplicates it finds by setting the transaction type to Duplicate.
  5. Coinbase Pro - the converter recognises both the "Fills Report" export for trades and the "Account Report" export for deposits and withdrawals. Please note, the "Account Report" also contains details of the trades ("match") but with less detail, these are filtered by the tool to prevent duplicates.
  6. GateHub - some exports contain incomplete data (i.e. no counter asset in an "exchange"), these are possibly failed transactions, the tool will filter them and raise a warning for you to review, the data still appears to balance correctly. Any Ripple network fees which cannot be attributed to a "payment" or an "exchange" will be included separately as a Spend transaction record.
  7. Qt Wallet - by default, unconfirmed transactions are filtered by the conversion tool, if you want to include them use the -uc or --unconfirmed command argument.
  8. Exchanges which do not balance (just some dust left) are Cryptopia, OKEx, TradeSatoshi.

Price Tool

The bittytax price tool bittytax_price allows you to lookup current and historic prices of cryptoassets and foreign currencies. Its use is not strictly required as part of the process of completing your accounts but provides a useful insight into the prices which bittytax will assign when it comes to value your cryptoassets in UK pounds.

Data Sources: The following price data sources are used.

The priority (primary, secondary, etc) to which data source is used and for which asset is controlled by the bittytax.conf config file, (see Config). If your cryptoasset cannot be identified by the primary data source, the secondary source will be used, and so on.

All price data is cached within the .bittytax/cache folder in your home directory, this is to prevent repeated lookups and reduce load on the APIs which could fail due to throttling.

Usage

To use the tool you need to pass the asset symbol name, either for a cryptoasset (i.e. BTC) or a foreign currency (i.e. USD), the second argument is only required for historic data lookups, the date must be in the format (YYYY-MM-DD). If the date is not specified the current price will be returned.

bittytax_price asset [date]

If the lookup is successful not only will the price be displayed in the terminal window, but also the data source used and the full name of the asset. This is useful in making sure the asset symbol you are using in your transaction records is the correct one.

$ bittytax_price ETH
INFO -- : 1 ETH=£124.93 GBP via CryptoCompare (Ethereum)

Since there is no standardisation of cryptoasset symbols, it's possible that the same symbol has two different meanings across different data sources. For example, BTCP is Bitcoin Private on CryptoCompare, but also Bitcoin Pro on CoinGecko.

If bittytax is not picking up the correct price for you, you can change the config so that the asset symbol only uses the data source you require, see Config.

You can use the help command argument to display a full list of the command line arguments.

bittytax_price --help

Another useful function of the price tool is to calculate the historic price of a specific transaction, you can use the -q or --quantity argument to specify the quantity to price, this can be used as a memory jogger if you are looking at old wallet transactions and trying to remember what it was you spent your crypto on.

$ bittytax_price BTC 2014-06-24 -q 0.002435
INFO -- : 1 BTC=£338.59 GBP via CoinDesk (Bitcoin)
INFO -- : 0.002435 BTC=£0.82 GBP

Notes:

  1. Not all data source APIs return prices in UK pounds (GBP), for this reason cryptoasset prices are requested in BTC and then converted from BTC into UK pounds (GBP) as a two step process.
  2. Some APIs return multiple prices for the same day, if this is the case then the 'close' price is always used.
  3. Historical price data is held for each data source as a separate JSON file in the .bittytax/cache folder within your home directory.

Config

The bittytax.conf file resides in the .bittytax folder within your home directory.

The default file created at runtime should cater for most users.

If you need to change anything, the parameters are described below, the file is in YAML format.

Parameter Default Description
fiat_list: ['GBP', 'EUR', 'USD'] List of fiat symbols used
crypto_list: ['BTC', 'ETH', 'XRP', 'LTC', 'BCH', 'USDT'] List of prioritised cryptoasset symbols
trade_asset_type: 2 Method used to calculate asset value in a trade
show_empty_wallets: True Include empty wallets in current holdings report
transfers_include: True Include transfer transactions in tax calculations
data_source_select: {'BTC': ['CoinDesk']} Map asset to a specific data source(s) for prices
data_source_fiat: ['ExchangeRatesAPI', 'RatesAPI'] Default data source(s) to use for fiat prices
data_source_crypto: ['CryptoCompare', 'CoinGecko'] Default data source(s) to use for cryptoasset prices
usernames: List of usernames as used by ChangeTip

fiat_list

Used to differentiate between fiat and cryptoassets symbols, make sure you configure all fiat currencies which appear within your transaction records here.

crypto_list

Identifies which cryptoasset takes priority when calculating the value of a crypto-to-crypto trade (see trade_asset_type). The priority is taken in sequence, so in an ETH/BTC trade, the value of the Bitcoin would be used in preference to Ethereum when pricing the trade.

The list should contain the most prevalent cryptoassets which appear in exchange trading pairs, these are predominantly the higher market cap. tokens.

trade_asset_type

Controls the method used to calculate the asset value of a trade:

  • 0 = Buy asset value
  • 1 = Sell asset value
  • 2 = Priority asset value (recommended)

For every trade there are always two assets involved, fiat-to-crypto, crypto-to-fiat or crypto-to-crypto. When bittytax is trying to calculate the value of a trade, it uses this parameter to determine which asset value should be used to price the trade in UK pounds.

For trades involving fiat, it's obvious that we want to price the asset using the fiat value, but for crypto-to-crypto trades it's not so straight forward.

The recommended setting is 2 (Priority), this means that the asset value chosen will be selected according to the priority order defined by the fiat_list and crypto_list parameters combined. Fiat will always be chosen first, followed by the most prevalent cryptoasset.

Setting this parameter to 1 or 2 will result in either the buy asset value or the sell asset value always being used, regardless of whether the trades involved fiat or not.

show_empty_wallets

Include empty wallets in the current holdings report. Can be set to True or False.

transfers_include

Include transfer transaction types (i.e. Deposit, Withdrawal) in tax calculations. Can be set to True (recommended) or False.

Although these transactions types are non-taxable they do affect the cost basis of your cryptoasset holding.

data_source_select

Maps a specific asset symbol to a list of data sources in priority order.

This parameter overrides the any data sources defined by data_source_fiat and data_source_crypto, see below.

By default, only an entry for BTC exists, this selects CoinDesk as the primary data source for bitcoin prices, and CryptoCompare as the secondary.

If, for example you wanted BTCP to use only the CoinGecko data source, you would change the config as follows.

data_source_select: {
    'BTC': ['CoinDesk', 'CryptoCompare'],
    'BTCP': ['CoinGecko'],
    }

data_source_fiat

Specifies which data source(s), in priority order, will be used for retrieving foreign currency exchange rates.

data_source_fiat:
    ['ExchangeRatesAPI', 'RatesAPI']

Supported data sources for fiat are:

  • ExchangeRatesAPI
  • RatesAPI

data_source_crypto

Specifies which data source(s), in priority order, will be used for retrieving cryptoasset prices.

data_source_crypto:
    ['CryptoCompare', 'CoinGecko']

Supported data sources for cryptoassets are:

  • CoinDesk
  • CryptoCompare
  • CoinGecko
  • CoinPaprika

usernames

This parameter is only used by the conversion tool.

It's required for ChangeTip data files, the list of username(s) is used to identify which transactions are gifts received and gifts sent.

An example is shown below.

usernames:
    ['Bitty_Bot', 'BittyBot']

Future

Ideas for the project roadmap, let me know what you would fine most useful, or any new features you would like to see.

General

  • Document code
  • Add tests

Conversion Tool

  • Add Wirex exchange
  • Add Binance exchange
  • Convert data from clipboard. Some wallets/exchanges don't provide an export function, it should be possible to copy the transaction data directly from the webpage and have the conversion tool analysis this data and then convert it into the transaction record format.
  • Add option to generate .xls file of transaction records instead of .csv, this will make editing in Excel easier.
  • Add exchange APIs to automatically convert new trades into the transaction record format.

Price Tool

  • Add command option to list supported cryptoassets symbols/names for a specific data source(s).

Accounting Tool

  • Allow loading of .xls transaction records file.
  • BittyTax integration with Excel. The command line interface is not for everyone, by integrating with Excel (or Open Office) this would greatly improve the user experience.
  • Create a PDF file for the tax summary report which can be attached to your self assessment.
  • Add export function for QuickBooks (QBXML format), to include transactions records with exchange rate data added.
  • Tax rules for other countries

Resources

HMRC Links:

HMRC Webinar

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