HMRC crypto tax rules are tightening, and UK taxpayers with cryptoassets are under increasing scrutiny. Here’s what you need to know to stay ahead of HMRC’s sweeping new powers.
At a glance:
- New rules from January 2026 mean UK-based crypto platforms must report your personal and transaction details to HMRC.
- Data collected includes your name, address, NI/tax number, and full crypto activity – even if no gains are made.
- HMRC will match this data with your Self Assessment tax return or pursue penalties for non-disclosure.
- From the 2024–25 tax year, crypto gains and income must be reported in a new dedicated section of your tax return.
- Capital Gains Tax (CGT) may apply when selling, exchanging or using crypto.
- Income Tax and National Insurance may apply if you receive crypto via employment, mining, staking or lending.
- Penalties of £300 may apply for non-compliance, with additional charges for late filings or undeclared gains.
- HMRC’s Cryptoasset Disclosure Service (CDS) is available for voluntary disclosure – but advice should be sought before using it.
- 52 countries, including the UK and EU, are adopting the Cryptoasset Reporting Framework (CARF) for global data sharing.
- Offshoring crypto will not protect from tax scrutiny once CARF is in place internationally.
- UK taxpayers are advised to act now to ensure correct records and reporting for 2024–25 and beyond.
What’s Changing in HMRC Crypto Tax Rules?
From 1 January 2026, HMRC will begin receiving detailed reports of your cryptoasset activity directly from crypto platforms. This change is part of the OECD Cryptoasset Reporting Framework (CARF), which the UK government has committed to implementing under the Finance (No. 2) Act 2023 and associated regulations.
This means any UK-based crypto exchange, wallet provider, or platform will be legally required to collect and report:
- Your full name, address and date of birth
- Your tax residency and National Insurance/tax reference number
- The type and number of cryptoassets you buy, sell or hold
- The date, value, and nature of each transaction
Crypto platforms that fail to report or submit inaccurate data could face fines of £300 per user, and individual users who don’t comply could be fined the same.
These reports will allow HMRC to cross-check your Self Assessment return, or spot if you failed to file one at all.
Are You Already Affected? Yes, for the 2024–25 Tax Year
Even before CARF reporting begins, HMRC crypto tax rules are already targeting crypto investors.
Starting with the 2024–25 tax year, UK taxpayers must report all crypto-related gains or income in a new dedicated section of the Self Assessment capital gains pages.
According to HMRC’s Cryptoassets Manual, capital gains tax applies when you:
- Sell crypto for cash (including to fiat or stablecoins)
- Swap one cryptoasset for another (e.g. ETH → BTC)
- Use crypto to buy goods or services
- Gift crypto (except to a spouse or civil partner)
You must calculate your gain/loss for each disposal, using either the Section 104 pooling rules or the ‘same day’ and ‘30-day’ matching rules, just like shares.
In addition, income tax and national insurance may apply if you receive crypto:
- As part of employment (e.g. salary or bonuses)
- Through mining, staking, or airdrops
- Via lending platforms or DeFi protocols (where interest is earned)
HMRC has confirmed that crypto-to-crypto transactions are taxable events, and simply holding crypto without selling it does not trigger a tax liability, but you must keep records regardless.
How Will HMRC Know?
Currently, HMRC uses a mix of:
- Data from UK exchanges via existing legal powers (e.g. notices to Coinbase in 2020)
- Voluntary disclosures from taxpayers
- AI and transaction-tracing tools (blockchain analytics)
But under CARF, this will be taken to the next level.
From January 2026, crypto platforms must proactively report all relevant transactions for both individuals and entities, even if no gain was made.
This means even dormant accounts or casual users will be visible to HMRC, and historical non-compliance could be flagged where HMRC picks up a pattern.
How Many People Are Affected?
According to the FCA’s most recent survey (2025), around 7 million people in the UK (roughly 12% of the adult population) now hold crypto. That’s a 20% increase year on year.
With Bitcoin’s value surging from £38,000 in August 2024 to £86,000 in January 2025, HMRC has a clear incentive to track down and tax those gains.
The Treasury estimates the CARF regime could raise £315 million in unpaid tax by 2030, roughly the cost of funding 10,000 NHS nurses for a year.
Do I Need to Act Now?
Yes. Even though the CARF rules start in 2026, you are already legally required to report crypto transactions for the current tax year (2024–25).
Here’s what you should do:
- Review all your crypto transactions since 6 April 2024
- Download full transaction histories from all wallets and exchanges you’ve used
- Keep records of acquisition costs, transaction dates, and disposal values
- Include crypto gains or income in your 2024–25 tax return (due 31 January 2026)
HMRC recommends using their Cryptoasset Disclosure Service (CDS) if you believe you have failed to report crypto income or gains in earlier years. However, seek advice first, as this may not always be the most tax-efficient route.
What Happens If I Don’t Report?
HMRC has confirmed, “The new rules will help unmask anyone evading tax due on their crypto profits. Those who don’t comply risk a £300 fine.”
In practice, this could mean:
- Penalties for failure to notify HMRC of a liability (up to 100% of the tax due)
- Daily late filing and late payment penalties
- Interest on unpaid tax
- A formal enquiry or investigation
The penalty HMRC is likely to apply will depend on severity and intent.
Once CARF data starts arriving in 2026, HMRC will have a full picture, so 2024–25 and 2025–26 will be key years to get your tax affairs in order voluntarily.
Which Countries Are Involved?
The CARF rules are being rolled out globally. The UK is one of the first countries to implement it, alongside:
- The EU, Jersey, Guernsey, Isle of Man, South Africa and Uganda (by 2027)
- The US, Singapore, UAE, Hong Kong, Turkey and others (by 2028)
This means offshoring your crypto will not protect you. Major jurisdictions will soon be exchanging data under CARF, similar to how banks now share information under the Common Reporting Standard (CRS).
Contact us today if you hold or have traded crypto. We’ll guide you through HMRC crypto tax rules and, where needed, connect you with a trusted crypto tax specialist.
Keep more of your gains by staying compliant and avoiding penalties.