Quick Summary
- HMRC treats crypto as property: selling, swapping or spending it can trigger Capital Gains Tax.
- Crypto-to-crypto swaps count as disposals, even if you never cashed out to pounds.
- Staking, mining and being paid in crypto can be income.
- You must report if gains exceed £3,000 or disposal proceeds exceed £50,000.
- From 1 January 2026, UK crypto platforms collect user details to report to HMRC.
Many people who bought crypto as an investment don't realise how many of their transactions are taxable — or that HMRC is now receiving data directly from exchanges. Here's what you need to know.
When is crypto taxable?
For most individual investors, crypto is subject to Capital Gains Tax when you "dispose" of it. A disposal includes:
- Selling crypto for pounds or any other currency
- Swapping one crypto for another (for example Bitcoin to Ethereum)
- Using crypto to pay for goods or services
- Giving crypto away (except to a spouse or civil partner)
Simply buying crypto, holding it, or moving it between your own wallets is not a disposal.
How much tax?
Gains above the £3,000 annual exempt amount are taxed at 18% within your basic rate band and 24% above it. Losses on crypto can be set against gains if you report them to HMRC.
Working out the gain: pooling rules
You can't just pick which coins you sold. HMRC's matching rules apply in this order:
- Same-day rule — match with coins of the same type bought on the same day.
- 30-day rule — match with coins bought in the following 30 days.
- Section 104 pool — otherwise use the average cost of all the coins of that type you hold.
With hundreds of trades across several exchanges, crypto tax software or an accountant is usually needed to get this right.
When crypto is income
Some crypto receipts are taxed as income, at your income tax rates, based on their value when received:
- Being paid in crypto by an employer or customer
- Mining, depending on the scale of the activity
- Staking rewards and some airdrops, in many cases
If you later sell those coins, any further rise in value is a capital gain.
Do I need to report?
You need to report crypto on a Self-Assessment return if, in the tax year:
- Your total gains are above the £3,000 annual exempt amount, or
- The total proceeds from all your disposals are more than £50,000 — even if you made no gain, or
- You received crypto income, or want to claim a loss
HMRC is getting exchange data
Under the international Cryptoasset Reporting Framework, UK crypto platforms have been collecting customers' details and transactions since 1 January 2026, ready to report them to HMRC. HMRC also already gets data from many exchanges and sends "nudge letters" to people it believes haven't declared crypto gains.
Haven't declared crypto before?
HMRC has a dedicated online disclosure route for unpaid tax on cryptoassets. Coming forward voluntarily usually means lower penalties than waiting to be contacted. We can rebuild your transaction history from exchange exports, calculate the gains and handle the disclosure.
Records to keep
- Date, type and amount of every transaction
- Value in pounds at the time of each transaction
- Exchange and wallet statements and fees paid
Frequently Asked Questions
Do I pay tax on crypto in the UK?
Yes, in most cases. Selling, swapping, spending or gifting crypto can trigger Capital Gains Tax, and crypto received as pay or from staking or mining can be taxed as income.
Is swapping one crypto for another taxable?
Yes. HMRC treats a crypto-to-crypto swap as a disposal, so you may have a capital gain even if you never converted to pounds.
Do I need to report crypto if I made a loss?
You should report if your total disposal proceeds exceed £50,000, and you need to report losses to be able to use them against future gains.
Can HMRC see my crypto?
Increasingly, yes. UK platforms have been collecting user and transaction details since 1 January 2026 under the Cryptoasset Reporting Framework, and HMRC already gets data from many exchanges.
What if I haven't declared crypto gains before?
Use HMRC's voluntary disclosure process. Coming forward before HMRC contacts you usually results in lower penalties.
Need a Crypto Accountant?
We calculate gains using HMRC's pooling rules, report crypto on your tax return and handle disclosures for past years.
Sardar Muhammad, AAT
Sardar is the founder of LimeTree Accounting Solutions, an AAT-accredited practice in Govanhill, Glasgow. He works with sole traders, tradespeople, landlords and small limited companies across Glasgow and Clydebank.
This guide is general information based on UK and Scottish tax rules as at 13 October 2026. It is not personal advice. Rates and thresholds change, so speak to us about your own situation.