Posted on March 10, 2019
In order to create a clear picture regarding the taxation details of cryptocurrencies, including exchange tokens like bitcoin, Her Majesty’s Revenue and Customs (HMRC) recently released a comprehensive and elaborate framework. This tax framework clearly explains the handling and taxation of cryptocurrencies and other related financial policies.
After the release of these guidelines, investors will have a clear picture regarding the tax treatment and calculation of their cryptoassets. Here is what you need to know about these guidelines to understand how these changes might affect your crypto tax.
Cryptocurrency tokens under HMRC guidance
Famously known as cryptographically secured virtual representation of value, cryptocurrency or cryptoassets can be stored in your wallet, transferred to another wallet, and traded. All these functions are done using Distributed Ledger Technology. Crypotassets are not considered to be real money or currency, and are identified as either security tokens, utility tokens, or exchange tokens.
● Security tokens provide distinct interests in businesses, for example, profit share.
● Utility tokens give access to purchase of goods and services.
● Exchange tokens are largely used for payments and their value depends on exchange and investment.
The HMRC guidance treats different types of tokens according to their nature and intended use. The first report of the guidance considers taxation of only exchange tokens, for example, bitcoins.
Taxes applicable under HMRC guidance
HMRC lays clear differences between gambling and cryptoassets and does not consider them to be the same. Consequently, distinct guidelines for crypto currency tax calculation are highlighted in this report. The following types of taxes might be applicable in cryptoassets, subject to individual cases:
● Direct income tax
A direct income tax is levied on exchange tokens under the following circumstances.
1. Financial trading
If the holder of cryptoassets carries out trading with them, he/she is liable for a direct income tax under specific circumstances. If so, this income tax will supersede Capital Gains Tax and considered as a business. The business income manual accompanying HRMC guidance has all details pertaining to this tax calculation.
2. Crypto mining taxes
Mining with cryptoassets typically involves use of computers to generate new cryptoassets. Depending on the degree of mining, risk associated, commercial alignment, and organisation of this activity, it will be considered a taxable trade. If it so happens that mining cannot be considered a trade, the corresponding Pound Sterling value of these cryptoassets will be considered taxable.
3. Taxes for airdrops
When an crypto currency investor receives tokens as part of a random selection, these tokens come with their own specifications that work differently from the rest of cryptoassets. Accordingly, income tax may or may not be applicable on these tokens. However, the disposal of these tokens may lead to Capital Gains Tax.
● Capital Gains Tax
When cryptoassets are used for investment rather than trading, individual investors are subject to Capital Gains Tax. Since cryptoassets are intangible, they are considered to be chargeable only if they can be owned and possess a net value.
When cryptoassets are sold off in exchange of money, used for payment, given away to others or exchanged to another type of crypto currency, they are considered to have been disposed, and are subject to Capital Gains Tax accordingly. However, if they are donated, they are exempted from this tax.
What are allowable costs under the guidance?
Tax deductions may be used for lowering your crypto currency taxes. These deductions will depend upon the consideration paid originally for acquiring the asset, incumbent transaction fees, professional costs, costs for making valuation, and any costs for advertising.
Mining costs are not included in these costs because they are not dedicated to acquiring crypto currency only. However, part of these costs is eligible for tax exemption, for example, upon declaring these costs against profits or upon disposal of mining equipment.
What about cryptoassets as earnings?
If your cryptoassets include those earned in the form of an income of any kind, they will be counted in terms of their money’s worth. Coinsequently, they will be liable for income taxation. Specific guidelines exist for cryptoassets that are Readily Convertible Assets (RCA) and not RCAs. These cryptoassets are clearly defined in the HRMC guidance, and related information should be read carefully to make full use of applicable deductions, wherever possible.
In addition, there might be some cryptoassets that are given by employers or another party as payment for certain tasks. If they arise because of an employment, they are treated for income tax. Employers must disclose such details to HRMC for proper tax calculation.
Implications for the investor
As an immediate outcome of the guidance, the entire responsibility of maintaining records and tracking transaction details lies on the investor. It is thus prudent to rely on a suitable cryptotaxsoftwareto maintain records and details of The number and types of token you possess in your wallet, their total value in Pound Sterling, accompanying bank statements, disposal details etc. Additionally, investors are also required to keep complete records of their wallet addresses and get all their transactions categorised into trade, investment and value.
Also, since the guidance has clearly outlined the circumstances under which a particular transaction will be taxable under different categories, it is important to establish the identity of the cryptoassets as RCAs, and benefit from specific deductions. The last date for declaring and paying cryptocurrency taxes for the financial year 2017-2018 is 31st January 2019.…
Posted on January 20, 2019
Time is valuable, should be rewarded and games have tried rewarding their players in various ways. It’s always nice to get a new Steam badge, but turning that time into something valuable has required bending the rules.
Until now — we are proud to officially announce that Skara will reward its community by connecting to the wider economy on the blockchain.
Thanks to new cryptocurrency technology, it is now possible to make our game rewards tradable in the greater world economy through a legal, and regulatory compliant method.
SKARA is therefore announcing the creation of a new cryptocurrency in the form of an ERC-20 token based on the Ethereum blockchain.
We call it a SKARAT (SKARA Token — SKT), which can be traded on the open market.
SKARATs and valuable game items will be stored in a decentralized blockchain on the user’s dedicated Ether wallet. The game will allow the user to link his blockchain identity (wallet) to his account in SKARA. Accounting for game assets through the blockchain allows the users to take the value of their game items outside of the SKARA universe. By having the freedom to buy, trade and sell items, Skara assets (including SKARATs) become even more collectible and valuable.
Some of those assets – including new skins not seen before in our Alpha – are already on the blockchain in Book or Orbs.
We would like to take the opportunity now to thank you for your previous and future support and to let you all know the pride and responsibility we feel in continuing to build this incredible universe alongside you.
Please visit www.skaratoken.com to learn more about the SKARATs and how this will impact the development of our project.
See you on the battlefield,
Pablo and the SKARA team…
Posted on January 10, 2019
Today is probably the saddest day since we started this adventure: the team of 8-Bit Studio must announce that we are stopping the development of Skara – The Blade Remains, the indie multiplayer combat game you have enjoyed on Steam Early Access.
There are a lot of reasons for us to stop this development – including several bad decisions on our end – but we could summarize them in three: resources, technology and market.
The point about resources is quite clear for most of you guys who know us since the beginning: we no longer have the team and the money to achieve such an ambitious project. When we started this adventure the goal was clear: invest all our personal money to get Skara – The Blade Remains to an Alpha/Beta stage and then try to convince a publisher to fund the final part of the development. We couldn’t achieve that last goal.
Technology is also a major cornerstone on any multiplayer game and things have not been easy for us: as one of the first few studios working on Unreal 4 we had to rely on earlier versions of the engine – most of them without a lot of multiplayer support yet – so we modified the engine to allow a good replication on servers. These house-made features came with a huge problem: we were not able to update our version of Unreal 4. Moreover, the programmers who built that system left the company and their knowledge left with them.
Meanwhile, the guys at Epic kept improving the engine and releasing more and more multiplayer capabilities, most of them based on Fortnite. Suddenly, those features became the new standard for multiplayer games on Unreal 4. We had to make a decision: to try to teach new programmers how to use our old systems or to make a huge effort to update all our code to the new UE4 versions. Turns out we didn’t have the time or the money to do any of those.
The final reason is the market, and this is probably the most important one: when we started this development back in 2013 the multiplayer market for PC and consoles was still fresh, plenty of space for new ideas and teams working on free-to-play titles. But today in Fortnite’s era it is nearly impossible for an indie title to become sustainable, especially games with huge server costs like Skara. Nowadays you need big teams, constant updates, customer service and a huge marketing budget to reach a playerbase big enough to make profits out of a free game: only 1 out of 500 indie games made it on 2018.
Publishers know this, and that’s the main reason we couldn’t sign a deal with any of them. ‘Your game is good, but numbers are your problem’ was the most common answer after reviewing Skara. Today, a free-to-play game needs millions of players to start generating revenues, and the only way to get them is to spend a lot of money on marketing.
We tried as hard as we could during 2018 to keep the team together while we were looking for the money to finish the development, but we couldn’t make it. A big part of the team left the company and we are even saying goodbye to our beloved office in Barcelona.
But… Is this the end of Skara? No, not yet. Some of us are still fighting and working on a new game based on the Skara Universe. This game will follow the themes that made Skara popular among our players: Combat and Narrative – but on a smaller scale and single player only. We are close to announce how it looks so if you are still interested in Skara stay tuned to our Discord server.
More importantly: is there a chance to see Skara – The Blade Remains back? Yes. We had a lot of fresh and good ideas for our old game waiting to be implemented so we would really like to do multiplayer in the future… but first we need to start making money out of the games we create, and then decide if we want to go that route again.
Lastly, I would like to personally thank all of you for being there, for being as enthusiastic and supportive about our game as you have been since we released our Alpha version. I had a blast playing with you, discussing with you on the forums or being killed by you on the weekly dev streams. You guys know that, after so long, I consider some of you among my closest friends and our conversations were often beyond videogames. I also want to apologize for not keeping up with you guys lately… you never gave up on this project and didn’t deserve silence as a response.
I will write a second part on this post explaining other things, more information about the upcoming Skara project and unveiling some secrets about The Blade Remains you guys haven’t seen yet.
Hope to see you on the battlefield… someday.
Pablo and the Skara team.…
Posted on December 2, 2018
SKRT is the official virtual currency of the videogame and universe of Skara. You can trade SKRT on Mercatox!
As an interface designer by trade, one of the things that shocked me when I started interacting with the blockchain was User Experience. Necessary plugins like MetaMask, gas prices, failed tokens transfers, complex use flows… It was a designer’s nightmare! It took a while for me to get used to the entire system, with the added complexity of a rapidly changing environment, since this is a technology that constantly evolves and gets better.
When we launched our successful ICO back in February 2018, User Experience for our contributors was on the top position of my priority list. On most of the previous ICO’s the process was dark and insecure — driving to a lot of scammers trying to fish uncautious investors — so we tried a different approach using our website and the token sale smart contract to buy, claim and distribute the tokens to all the potential holders — a list that would include investors, advisors, team and bounty program members.
All the interactions with the ICO were handled by the smart contract, whether for tokens purchases, vesting and token claim. Each contributor’s tokens were linked to their preferred wallet, so anyone could claim them but the tokens will only end on that specific wallet address. This process was way more secure than manually sending the tokens from our wallet to the contributor’s wallet. The vesting schedule was clear, tokens could be claimed from our own website and the process took only a couple of minutes.
We were really happy with this flow, tested it over and over, and thought that everything was going to run smooth.
Turns out we were wrong: we encountered a big resistance from some contributors and bounty members. They were so used to the old manual system that they didn’t understand why they should install MetaMask and interact with a smart contract if we could just send them the tokens they paid for!
The conversations were always similar (language was also a barrier):
“ — Don’t want smart contract. Just send tokens to wallet.”
“ — But… That is what blockchain is all about!”
“ — Just send me tokens. No MetaMask. Only MEW.”
“ — Don’t worry, I can claim the tokens for you.”
“ — No. I need tokens on my MEW. You scammer.”
When we completed the process for them they suddenly understood it. But, as any designer should know, that needs to happen before. It was time to get back to the drawing board and prepare the future User Experience flow for our upcoming Dapp — the tool we were working on that allows players and investors to send their tokens from a wallet to the Skara ecosystem.
First thing we noticed after many conversations: MetaMask should go out of the equation. We found a huge resistance from new users to try and install it. Even if really popular blockchain games such as CryptoKitties use MetaMask, the adoption curve is not big enough, just yet. It didn’t work on mobile either. We needed to find another way.
Back in the conversations with the Design and the Code teams, I always used the same analogy: The first time you try Netflix you get blown by how simple is to register and access the huge database of movies and series. It was nice, simple, well designed, beauty… Coinbase has a great User Experience flow. Kraken has a terrible one. We knew what we wanted and how we wanted it.
Why is this so important? We always said that one of our advantages is that we already have a working product — the game on Steam — and a user base. This, combined with the contributors and investors interested in crypto, give the SKRT’s a solid chance of thrive on a crowded market. But if we want our players to buy the tokens on the open market we need to build a solid, secure system that is understandable and easy to use, since thay may have no previous experience on the blockchain.
After months of hard work we have the first step of the Skara’s integration on the blockchain almost ready to hit Steam. Players will be able to easily create a wallet, buy tokens and transfer them to the game in just a couple of steps. This is huge and a real revolution that can work on any platform thanks to the blockchain — whether it is on Steam or any other PC publisher, mobile, or console.
If you are a Skara Token holder, there are many reasons to be happy right now. If you are not… what are you waiting for? Go to Mercatox and buy some!
Pablo Rodríguez, CEO and Creative Director of Skara.…
Posted on June 15, 2018
Greetings survivors, and welcome once again to a brand new version of SKARA!
First of all, we would like to thank each and every one of you for your patience and feedback – without you we wouldn’t be able to release what we think it’s the best version of the game the world has seen.
We believe we’re finally on the right track for a future final release of this game. Nevertheless, we believe in the constant improvement of our product, so expect patches and new updates to guarantee the best overall experience.
We’ve been working hard to solve issues of previous builds and also add new and exciting features that you can finally try out! The new update has seen the following improvements:
New feature: Daily quests
Periodic objectives are common in a lot of games, but we wanted to add a special flavor to them in Skara. Daily Quests allow you to gain experience faster and get access to those tasty Zem Orbs more often while you achieve specific goals – “Win 4 games as a Tamvaasa”, for instance – but this feature will also let you develop the background story for your characters and influence the world of Skara! Join our Discord if you still haven’t and choose your side.
Rework + New cosmetics: Victory poses
We know winning is among the most satisfying things in Skara… But what if you can now customize the way your character looks on the winning screen? Introducing Victory Poses, a fancy set of animation you can unlock to add a special touch to the end match screens.
Each class has now 4 Victory Poses available in the Armory. The first one comes by default – meaning that everyone will have them from day one – so make sure you unlock and get the others to stand out from the crowd.
Hearing your feedback about the gameplay and character balance is one of the most strict rules we have here in the Skara studio, so we have come with A LOT of changes on the combat balancing. Check out all the changes below, detailed as never before, so you can eb aware of every small change we made and take your fighting performance to the next level.
Here you can see the complete – and exhaustive – list of gameplay changes:
Average damage slightly decreased, Celean’s charge first impact is no longer blockable or parriable, Tani can generally block one or two more attacks before running out of stamina
“Tani are supposed to focus on a defensive role in combat, holding positions with their shield and long range attacks. We consider their high damages and weak blocking were moving them away from this role, so we decided to make some changes to both of them to strengthen their defensive capabilities.”
Primary attacks (LMB or X)
Damage: P1 55 / P2 65 / P3 85 → P1 50 / P2 60 / P3 70
Secondary attack (RMB or Y)
Damage: S1 45 / S2 55 / S3 65 → S1 40 / S2 50 / S3 60
Damage: Sprint_P 75 → Sprint_P 70
Signs (aka skills)
Celean charge (Q or RB)
Celean’s charge first attack is no longer deflectable.
Some special attacks damage have been decreased. Refactor of Ice Embrace trap as Ice Claw, a wall against your enemies. Vilkai Song has been reworked to heal allies nearby for the duration of the buff.
“Eldun were kind of playing as lone wolves and we really wanted teams to play as a pack, so we have incentivized grouping up with the changes in their signs. With the new sign Ice Claw, we believe Eldun will create interesting team dynamics using the deflect mechanic against walls.”
Damage: Sprint_P 60 / Riposte_P 75 → Sprint_P 45 / Riposte_P 45
Signs (aka skills)
Ice Claw (Q o RB)
Ice Claw has been fully reworked. Now it summons instantly a wall that protects the caster and their allies against frontal assaults for 5 seconds.
Vilkai Song (E o RT)
Now Vilkai Song heals Eldun and their allies, as long as they remain inside of the AoE while the effect lasts.
The healing amount remains unchanged and is no longer halved in duel.
Increased damage. Go-Na Rush run cannot be blocked nor parried, Poison Flare are no longer effective against shields, Seeming-empty grants Dâ Shizu a 50% damage bonus in her first next attack.
“We believe that while Dâ Shizu were properly fitting the role of single target glass cannon characters, they were not giving a good enough reward given the high risk. To address that, we have significantly increased their damage so that they are now more dangerous if left unattended. We are aware secondary attacks have issues and we will keep monitoring their progress.”
Primary attacks (LMB or X)
Damage: P1 50 / P2 60 / P3 70 → P1 60 / P2 70 / P3 85
Secondary attack (RMB or Y)
Damage: S1 55 / S2 65 / S3 75 → S1 65 / S2 65 / S3 70
Damage: Dash_P 65 / DashBack_P 65 / Sprint_P 65 →
Dash_P 60 / DashBack_P 60 / Sprint_P 60
Signs (aka skills)
Go-Na Rush (Q or RB): Forest run is no longer deflectable. Nothing will affect the Go-Na Rush trajectory except walls and cliffs.
Poison Flare (F or LB): Now damage is fully absorbed by blocking.
Seeming-empty (E or RT): Invisibility now makes your next attack within 1 second deal 50% more damage (does not affect skills).
Decreased damage in primary and secondary attacks. Monster jump causes less area damage while retaining main impact damage.
“We want Zierk to fulfill their role as attacker in a more balanced way. Decreasing their damage while maintaining their huge amount of health should let them remain a real threat while not being so abusive. We think Zierk should not focus on pure damage but on disruption and with these changes they should feel more fair while still challenging.”
Primary attacks (LMB or X)
Damage: P1 55 / P2 65 / P3 85 → P1 45 / P2 55 / P3 70
Secondary attack (RMB or Y)
Damage: S1 60 → S1 40
Damage: Dash_P 50 / DashBack_P 50 / Dash_S 55 / Sprint_P 75 →
Dash_P 40 / DashBack_P 40 / Dash_S 40 / Sprint_P 60
Signs (aka skills)
Monster Jump (E or RT): Monster Jump landing now causes 60 damage points in a focused area and 25 in the surrounding AoE (previously it dealt 60 in the whole radius).…