The UK’s ‘Help with Payments’ scheme does not define crypto as disposable income.

British citizens hoping to get legal aid through the proposed “Help With Fees” (HwF) scheme will not have cryptocurrency holdings as disposable income.

The UK Ministry of Justice has published its response to a public consultation on its proposed legal aid scheme to improve equal access to the justice system. HwF aims to provide financial assistance for court or court fees to individuals with low incomes and little savings.

The program is designed to ensure that individuals who are unable to pay the associated fees are barred from entering the courts and tribunals. Its main objectives are to ensure access to justice for low-income individuals, provide funds to taxpayers who ultimately bear the costs of processing payments, and ensure that the program is accessible and that eligibility criteria are clear.

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The public consultation process contained examples of cryptocurrencies including a “non-exhaustive list” of the Ministry of Justice's proposal to include savings and investments.

According to the ministry, the majority of respondents support the proposal, highlighting that it helps capture investments that are not available as liquid assets.

Meanwhile, other respondents who disagreed with the idea expressed their opinion that pensioners and self-employed individuals should not be penalized for holding savings and investments.

“Also, there was an opinion that the incomplete list is very vague and should have more clarity, for example, cryptocurrency should be included.”

The government's response does not provide a list of capital types that include savings and investments, as it creates “unnecessary risk” for all capital that is abandoned or underdeveloped.

“Furthermore, we confirm that cryptocurrencies are covered by the current definition of capital under the Payment Orders and will continue to be covered by the proposed definition.”

The ministry plans to review the details in the public guidance accompanying HwF applications.

The public response also noted that individuals with savings or investments of more than £16,000 could use it to pay legal fees before receiving help from the HwF scheme.

The United Kingdom is on the verge of passing legislation that would bring cryptocurrencies under the same rules that govern traditional assets in the country. The Financial Services and Markets Bill is expected to give the UK Treasury, the Financial Conduct Authority, the Bank of England and the Payment Systems Regulator the ability to make and enforce rules for cryptocurrency-related businesses.

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