HMRC seize non-fungible tokens for first time

Although no official announcement has been published, we understand that last week HMRC seized non-fungible tokens (“NFTs”) for the first time, as part of an investigation into suspected VAT fraud. NFTs are non-interchangeable units of data stored on a blockchain, a form of digital ledger, that can be sold and traded. The seizure was completed using powers available to HMRC to seize assets in cases of suspected criminal fraud.

This development is interesting given HMRC’s recent focus on crypto-currency transactions and in the context of its desire for more powers to enable collection of tax debt where funds are held by taxpayers in non-traditional ways, such as in a blockchain.