UK Fiat to Foriegn Fiat and Purchasing Crypto with Various Currencies

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Hello, I need some guidance when recording various types of Crypto transactions in manager desktop 24.10.14.1886. I am UK based and am trying to keep to cost basis.

A brief backgroud of why I need advice. A few months ago I signed up to an exchange and started tradning some crypto coins. More of a hobby than an investment and with small amounts as a private individual just dipping his toe in and trying to learn more about trading etc.

Without paying no attention to accounting at the time, I was converting GBP to other fiats, USD and EUR, Stable coins such as USDT and using these currencies to buy and sell Crypto. Fast forward a few months and i am more up than down and need to start accounting.

I have used manager briefly in the past and if this was GBP only I would probably be comfortable treating the Crypto Coins as Inventory and making use of managers average cost to keep Legal books according to my knowledge and UK regs.

Example: Deposited ÂŁ1000, Convertet ÂŁ200 to EUR & ÂŁ200 to USD.
Purchased and sold various Cryptos using the above currencies and in some cases I purchased a coin in USD and it was later listed in GBP so swapped to buying in my local currency.

I need help running through and understanding these transactions.

I have been playing around so i can list some of the things i have tried/done to set things up.

Exchanges are treated like Bank accounts and have control accounts, along with exchange holding accounts for each coin held. I wanted to track by exchanges so i also set up Fee’s by exchange and rewards by exchange accounts.

I then set up inventory items for all my coins held and started to record some test transactions. This seemed straigh forward when dealing in local currency GBP!

My issues started with a coins transaction history that was first purchased months ago using USD and then multiple times in my local curency.

To start of with i need to record the initial conversion from GBP to USD. Can i legally treat USD/EUR etc like any other inventory item and have holding accounts per exchange? Not sure if i am thinking about this correctly, but would manager treating USD like inventory and tracking cost basis account for the exchange rate at the time of the transaction?

2nd I need to record the purchase of a crypto coin in the converted USD and account for the fee in USD.
Can someone please expalin how I do this in manager? Could I treat USD like an inventory item and use “inventory item transfers” to account for the sale and a separate transaction to account for the fee?

Sorry, finding this some what confusing :confused:

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No, you can not. Manager is an accounting application and you need to set a base currency and can have multiple foreign currencies. You can set exchange rates as usual and these result in FOREX gains or losses based on those rates.

I am not sure what you want to do but Manager does not provide what tried to understand and will not treat any currency as an inventory item. You can buy inventory items with any currency but they always will be “translated” to the base currency as they should for tax purposes.

I would advise to look for crypto currency applications such as Cryptio to manage and reconcile cryptocurrency transactions and export the summarized data to Manager.

1 Like
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I would treat Crypto coins or asset as Investment items under the Investments Tab

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Thanks eko,
Never having dealt with foreign currencies I made the mistake of putting them in the same category as cryto currencies and thought i could track them the same, but it makes complete sense to me now.
“I am not sure what you want to do” I am trying to be HMRC compliant while tracking my crypto trading in manager as come April I may need to report capital gains tax. I will eventually be building a Python Bot to automate .csv file edit and import into manager, but after reviewing the .csv files provided by exchanges such as “Coinbase and Kraken” I first need to get my accounts set up and my head around recording all the different transactions manually.

I have created my Foreign currencies and was expecting to be able to select this currency when making payments and receipts, but I think the way my accounts are set up are key here.
I am going to try and make copy accounts for my exchanges that use USD/EUR and any more i may add in the future.

So my example account set up would be Exchanges = Bank accounts, So for example, Coinbase GPB, Coinbase USD and Coinbase EUR, same for other exchanges and have control accounts for each exchange. This should allow me to track everything per exchange properly?

In regards to crypto coins. UK uses “pooling method/average cost” and fee’s are included in this. I have been using the “quantity and unit price column” and a seperate line to record the fee per transaction to account for this.

Main Questions are,
Will this “coins as inventory” setup in manager automatically account for sales on my required pooling/average cost methed in order to be HMRC compliant?

and

Will manager be able to automatically calculate exchange rates from transaction in .csv file imports from these exchanges? I have a few months of transactions to work through and dont like the idea of sourcing backdated exchange rates.

Sorry for the noobness, I have basic bookkeeping knowledge but lack experience with both crypto and foreign currencies. I am currently signed up to “Koinly” free plan and have API’s connected to exchanges, this give me access to my average price and PnL ect in accordance to UK HMRC law. However I only get basic information and would need to pay for a tax report or even a .csv file download. My goal here is to balance my accounts in manager against what i see in the “Koinly” dashboard. If i manage this or even get close i will know my accounts are indeed in accordance to UK regs regarding crypto, I will have full offline, custom control and tracking of my accounts and will save myself the cost on my tax report.

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Hi, i appreciate your reply and suggestion. I am however just simply more familiar with inventory items in manager so would be more than happy if all works out.