Tax treatment of NFTs purchased with Crypto

[finlma]

It was only a matter of time before NFTs (non-fungible tokens) got a mention.

If I purchase NFTs using crypto currency and then sell the NFT at a profit am I subject to capital gains on the NFT and tax on any increase in the value of the crypto?

I'm just not really sure how I treat these for tax purposes.

 

[RedOnion]

My understanding is the purchase of the NFT for crypto is a CGT event for the crypto. You'd pay CGT on any gain, in euro terms, on the crypto from when you acquired it.
Then in future when you sell the NFT, it would also become a CGT event regardless if whether you sell for crypto or Euro (or anything else!). The Euro value becomes the base cost for your 'new' crypto asset.

 

[finlma]

Thanks for that.