Just like cryptocurrency, NFTs have taken the internet by storm. This has attracted much attention to the art industry, and some have seized this moment to make millions of dollars out of it. One of the major occurrences in the NFT industry was when an artist named Beeple sold his NFT titled “The First 5000 Days” for $69 million. This brought the digital art industry into the limelight.
NFTs (Non-Fungible Tokens) represent the ownership of digital assets and run on the blockchain, especially the Ethereum blockchain network. Cryptocurrencies such as Bitcoin also run on the blockchain. Each NFT acts as proof of ownership of an asset, but they are marketed as capable of giving ownership of real-world assets. Examples of digital assets that can be represented as NFTs include artworks, music, video clips, and data such as tweets. Jack Dorsey, the Twitter founder, recently sold his tweet in the form of an NFT for $2.9 million.
A common among those residing in the UK is:
Is NFT legal in UK?
Yes, NFTs are legal in the UK. Thus, it is possible to mint, buy, and sell NFT in the UK. In this article, we will discuss NFT UK in detail.
How to buy NFT UK
Now that you have known that NFTs are legal in the UK, your next question could be:
Where to buy NFT UK?
There are many reasons why people buy NFTs. Examples of such reasons include offering support to favorite artists, making money, and more.
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To buy cryptocurrencies such as Bitcoin and Ethereum, people visit cryptocurrency exchange platforms like Coinbase, Binance, and CoinMarketCap. These platforms also help them to know the current Bitcoin price and Ethereum price.
On the other hand, you can buy NFT UK by visiting an NFT marketplace UK such as OpenSea, Valuables, or NBA Top Shot. On these marketplaces, you can browse for the listed NFTs and buy the NFT of your choice.
The following are the steps how to buy NFT UK:
Step 1: Choose an NFT Marketplace
There are many NFT marketplace UK platforms that provide you with where to buy NFT UK. OpenSea is so far the largest NFT marketplace and it deals with all types of NFTs. It is also a good place to start if you are new to NFTs. It is easy to buy NFT UK on the platform or even list your NFT. Other NFT marketplace UK platforms include Rarible, Nifty Gateway, Foundation, and others.
Step 2: Create a Cryptocurrency Wallet
You will need a cryptocurrency wallet to buy an NFT UK. The wallet will help you to store the funds to be used for making payments. NFT marketplaces charge fees for buying NFTs on their platform. You will also be required to pay for the NFT that you buy. Most NFT marketplace UK platforms accept Ethereum payments, so it will be safe for you to have Ethereum coins. You can buy Ethereum from cryptocurrency exchanges like Coinbase, Binance, and Coin Market Cap and transfer it to your crypto wallet.
MetaMask is the most popular cryptocurrency wallet. It is also compatible with most NFT marketplace UK platforms.
After creating and funding your cryptocurrency wallet, connect it to the NFT marketplace that you have chosen.
Step 3: Buy NFT
At this point, you are ready to buy NFT UK. Browse through the NFTs listed for sale on the marketplace. You can also search for the NFT you desire to buy and purchase it. If the process of buying the NFT UK runs successfully, funds will be deducted from your cryptocurrency wallet and transferred to the NFT owner. You will then become the new owner of the NFT. The NFT marketplace may also charge you some fees for buying NFT on their platform. This fee will also be deducted from your connected cryptocurrency wallet.
NFT Capital Gains Tax UK
When it comes to NFT UK, there are two types of principal taxation to consider, namely income tax and NFT capital gains tax UK.
Whenever you sell a digital asset like NFT for profit, you are required to pay capital gains. You may also be a beneficiary of the long-term capital gains tax rate depending on the length of period that you have held the NFT.
Gifting or swapping NFTs, except for spousal relationships, is also subject to taxation. The reason is that HMRC views it as the disposal of an asset.
If you are the artist behind the NFT or its originator, you may be required to pay income sales for any sales made on the NFT.
If a transaction involving NFT UK seems to fall in the “grey area” in terms of tax, MRC may subject it to a series of tests called “The Badges of Trade.”
Thus, NFTs are assets and the UK government treats them as such as far as taxation is concerned.
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