As a Bitcoin company, we’re always looking for new ways to bring Bitcoin into our own daily lives.
Last summer, we introduced a new employee initiative and began paying salaries in Bitcoin — either a portion or all, depending on the individual’s preference. Tech Lead, Zakk, was even featured in the Mirror after opting to take his entire salary in Bitcoin.
Adding Bitcoin to your payroll is a great way to enhance a company’s benefits package, showing that you’re modern and flexible. Read on for guidance on how to introduce this as an initiative.
Why offer Bitcoin as a salary option?
Envelope — cheque — online bank transfer — Bitcoin?
Over the years, the process of paying salaries has changed a lot and long gone are the days of note-stuffed envelopes.
Offering Bitcoin salaries gives your employees the choice to invest in cryptocurrency regularly but with minimal effort or worry for the price. It’s similar to dollar cost averaging and gives automatic exposure.
It’s also a cool talking point for employees, helping to hype up your company ✌️
How to pay your employees in Bitcoin
At CoinCorner, our process was simple:
- Complete payroll as normal — We use an Isle of Man payroll software which gives a fiat tax amount and fiat net pay amount.
- Ask your team what they want — Find out what net pay your employees want to have automatically converted into Bitcoin.
- Sign up to buy Bitcoin at CoinCorner.
- Buy the specified amount of Bitcoin and send it to your employees — They’ll need a wallet address to receive their Bitcoin salary to, either from creating an account with an exchange or a personal wallet.
Overall, this works in the same way as an auto buying Bitcoin service.
How does tax feature?
Tax is handled as normal. Employee and employer income tax is calculated using their tax code and deducted in fiat, then paid across to the government in fiat before the net amount is converted to Bitcoin.
As our team is based in the Isle of Man and there’s no capital gains tax here, we had no further action to take.
However, capital gains tax is in place in the UK. This means there would be a requirement for UK employees to pay tax on any taxable Bitcoin transactions (e.g. selling).