In this article · 5 sections
A letter from HMRC about your cryptoassets is not an accusation. It means HMRC holds data suggesting you sold, swapped or earned crypto, and it would like you to check your returns. Ignore it and the next letter is less friendly. And the data is about to get much better: since 1 January 2026, every crypto platform serving UK users collects your details and your transactions for HMRC under the Cryptoasset Reporting Framework, with the first reports due in May 2027. Here's what that means and what we'd do this month. This is general information, not tax advice.
Why HMRC knows about your crypto
HMRC has been sending crypto letters since 2021, built from data it gets from UK exchanges and banks, and accountants report it is still doing so. The letters are 'one to many': the same text goes to thousands of people whose data suggests a gap. CARF is the bigger change. Under the UK's 2025 regulations, platforms must collect your name, address, date of birth and National Insurance number (or tax ID), record every disposal and transfer during 2026, and send it all to HMRC by 31 May 2027. If you don't give the platform your details, you can be fined up to £300. In other words, from next year HMRC won't need to guess.
Sources: GOV.UK, Cryptoasset Reporting Framework · ICAEW, HMRC guidance on cryptoasset reporting
What to do in the next 30 days
If a letter has arrived, or you simply know you haven't reported crypto gains, work through this in order:
- Read the letter for its deadline and what it asks. Some come with a 'certificate of tax position' to sign; don't sign anything until you have done the maths.
- Export your full history from every platform you've used, including closed accounts and wallets, from the first year you bought.
- Rebuild your gains and losses year by year. UK rules (same-day, 30-day and the Section 104 pool) make this hard to do by hand; this is where tax software earns its fee.
- If you owe tax for past years, use HMRC's online disclosure service for cryptoassets. Telling HMRC before it opens an enquiry usually means lower penalties.
- If the sums are large, or you have DeFi, staking or margin trading, pay an accountant who knows crypto. It costs less than getting it wrong.
Sources: GOV.UK, Tell HMRC about unpaid tax on cryptoassets
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How crypto is taxed in the UK, in one table
Most people only meet Capital Gains Tax, which applies whenever you dispose of crypto: selling for pounds, swapping for another coin, or spending it. A few situations bring Income Tax instead.
| What you did | Tax | Key numbers |
|---|---|---|
| Sold, swapped or spent crypto | Capital Gains Tax | £3,000 tax-free allowance; 18% or 24% above it |
| Disposals worth over £50,000 in a year | Must be reported | Even if your gain is under the allowance |
| Moved coins between your own wallets | Usually none | Keep records to prove they were yours |
| Staking, mining or certain airdrops | Often Income Tax | Taxed when received; CGT again when you sell |
| Paid in crypto by an employer | Income Tax and NI | Treated like pay |
Sources: GOV.UK, Check if you need to pay tax when you sell cryptoassets · GOV.UK, Capital Gains Tax allowances
Tools that build the report for you
Crypto tax software reads your exchange exports and wallet addresses, applies the UK matching rules and produces the figures for your Self Assessment. We link to Koinly: you can import your history and see your gains before paying, and you pay only to download the tax report. CoinLedger is a solid alternative with UK reports too; we have no link to it. Whichever you use, check the output for missing transfers between your own wallets, which these tools sometimes count as sales. A 30-minute check can remove a gain that never existed.
What not to do
Don't ignore the letter: a second one is often followed by an enquiry. Don't sign the certificate to make it go away if you aren't sure it's true. Don't move coins to an offshore platform hoping it won't report; CARF is an OECD standard adopted by dozens of countries, and platforms outside the UK report too. And don't pay anyone who cold-calls offering to 'settle' your crypto tax, a scam that tends to appear right after letter waves.
Next step
Rebuild your gains before HMRC does
Import your exchange history into a crypto tax tool and see what you owe before you decide anything. Free to preview, paid only for the final report.
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