Crypto Tax UK

Is cryptocurrency taxed in the United Kingdom? Do you want to know how UK crypto tax works and how HMRC views Bitcoin, Ethereum and other cryptoassets? In our complete crypto tax UK guide, updated for the 2026/27 tax year, we cover everything you need to know: Capital Gains Tax on crypto, Income Tax on staking, mining and airdrops, how HMRC tracks crypto, the new Cryptoasset Reporting Framework, how to report crypto on your Self Assessment tax return and the legal ways to reduce your crypto tax bill.

The rules have changed a lot in recent years. The Capital Gains Tax allowance has been cut to £3,000, Capital Gains Tax rates rose to 18% and 24% from 30 October 2024, and from 1 January 2026 UK crypto platforms must report your transactions directly to HMRC. If you last looked at your crypto tax position a few years ago, it is worth checking again.

 Is crypto taxable in the UK?

Do you pay tax on crypto in the UK? Yes. HMRC does not treat cryptocurrency as money or currency. It treats cryptoassets as property, so profits and income from crypto are taxable in the same way as other investments and income. If you have made gains or received crypto income above the relevant allowances, you will usually need to report it on your Self Assessment tax return.

 How is crypto taxed in the UK?

There is no specific Bitcoin tax or cryptocurrency tax in the UK. Instead, your crypto will be subject to either Capital Gains Tax or Income Tax, and sometimes both at different stages.

The tax you pay depends on what you are doing with your crypto:

• Capital Gains Tax applies when you dispose of crypto you hold as an investment, for example by selling it, swapping it, spending it or giving it away.
• Income Tax applies when you receive crypto as income, for example as salary, staking rewards, mining rewards, interest or most airdrops.
• Both can apply to the same tokens. For example, staking rewards are taxed as income when you receive them, and Capital Gains Tax applies to any increase in value when you later sell them.

We look at each of these in detail below.

 Crypto Capital Gains Tax UK

Because HMRC considers cryptocurrency to be a capital asset, you pay Capital Gains Tax when you dispose of it. A disposal includes:

• Selling crypto for GBP or another fiat currency
• Exchanging one cryptoasset for another, including stablecoins
• Using crypto to pay for goods or services
• Giving crypto away as a gift, unless it is to your spouse or civil partner
• Donating crypto to a charity (this is a disposal, but no gain or loss arises)

So whenever you sell, swap, spend or give away cryptocurrency in the UK, you need to consider Capital Gains Tax.

You do not pay tax on the full amount you receive. You are only taxed on your profit, which is the difference between what you receive (or the market value of the crypto when you disposed of it) and what it cost you, after any allowable costs.

 Do you pay tax on all crypto gains?

No. Every UK taxpayer has a Capital Gains Tax annual exempt amount. You only pay Capital Gains Tax on gains above this allowance.

The allowance has been cut sharply in recent years:

• 2022/23 and earlier: £12,300
• 2023/24: £6,000
• 2024/25 onwards, including 2026/27: £3,000

The £3,000 allowance covers all your capital gains in a tax year, not just crypto. If you also sell shares, for example shares from an employer share scheme, these gains use up the same allowance. Any unused allowance cannot be carried forward to a later year.

 Crypto Capital Gains Tax rates UK 2026/27

Unlike some other countries, the UK does not have separate short term and long term Capital Gains Tax rates. Holding your crypto for longer does not reduce the rate you pay. For disposals made on or after 30 October 2024, the rates are:

• 18% on gains that fall within your unused basic rate band (taxable income up to £50,270 in England, Wales and Northern Ireland)
• 24% on gains above the basic rate band, so higher and additional rate taxpayers pay 24% on all their taxable gains

Your gains are added on top of your taxable income to work out which rate applies. If your income is £40,000, you have around £10,000 of basic rate band left, so the first £10,000 of taxable gains is taxed at 18% and anything above that at 24%. The basic rate band used for Capital Gains Tax is the UK band, even if you are a Scottish taxpayer.

 How to calculate Capital Gains Tax on cryptocurrency UK

To calculate the tax on a crypto gain, start by working out your cost basis. Your cost basis is what it cost you to acquire your crypto in pounds sterling, plus allowable fees. If you acquired your crypto in another way, such as an airdrop or as staking rewards, your cost is usually the GBP value that was taxed as income when you received it.

Your capital gain or loss is then:

• The sale proceeds, or the GBP market value on the day you swapped, spent or gifted the crypto
• Less your allowable costs of disposal, such as exchange fees
• Less your cost basis, calculated under HMRC’s pooling rules (explained below)

If the result is positive, you have a capital gain. If it is negative, you have a capital loss, which you should report to HMRC because it can reduce your tax in the current year or future years.

Worked example

Sarah is a higher rate taxpayer. In 2022 she bought 1 Bitcoin for £20,000 and paid £100 in exchange fees. In January 2027 she sells it for £60,000 and pays £150 in fees. She has no other gains in 2026/27.

• Proceeds less disposal fees: £60,000 minus £150 = £59,850
• Less cost basis: £20,000 plus £100 = £20,100
• Capital gain: £39,750
• Less annual exempt amount: £3,000
• Taxable gain: £36,750
• Capital Gains Tax at 24%: £8,820

Sarah must report this on her 2026/27 Self Assessment tax return and pay the tax by 31 January 2028.

 UK cost basis rules for crypto: share pooling

HMRC has very specific rules for working out the cost of the crypto you dispose of, known as share pooling. They stop investors from selling at a loss and immediately buying back to create artificial losses. You must apply the rules in this order:

• Same day rule: if you buy and sell the same type of token on the same day, the disposal is matched with the tokens bought that day first.
• 30 day rule (bed and breakfasting): if you sell tokens and buy the same type of token back within the next 30 days, the disposal is matched with those later purchases.
• Section 104 pool: any remaining tokens are matched against your pool, which works like an average cost. You add up the total allowable cost of all the tokens of that type you hold and divide it by the number of tokens.

Each type of token has its own pool, so your Bitcoin, Ethereum and Solana are pooled separately.

Example of the 30 day rule

You hold 4 ETH in your pool at an average cost of £2,000 each. On 10 August 2026 you sell 1 ETH for £3,000. On 20 August 2026 you buy 1 ETH back for £2,500. Because you bought back within 30 days, the sale is matched with the new purchase, giving a gain of £500 rather than the £1,000 you would get by using the pool cost.

Broker and exchange reports rarely apply these UK rules correctly, which is one of the most common reasons crypto gains are misreported.

 Allowable costs for crypto Capital Gains Tax

You can deduct certain allowable costs when calculating your gain or loss. These include:

• The amount, in pounds sterling, you originally paid to acquire the cryptoasset
• Transaction fees paid before the transaction is added to a blockchain
• Exchange fees for buying and selling
• Professional costs for drawing up a contract for the acquisition or disposal
• Costs of advertising for a buyer or seller
• Costs of making a valuation or apportionment needed to calculate your gain or loss

 Costs that are not allowable for crypto Capital Gains Tax

The following costs cannot be deducted:

• Any costs already deducted against profits for Income Tax
• Costs of mining, such as electricity and equipment, for individuals mining as a hobby, because these costs are not wholly attributable to acquiring the crypto
• Fees for transferring crypto between your own wallets

If mining is carried on as a business, the crypto forms part of the trading stock. If tokens are later taken out of trading stock, they are treated as acquired at the value used in the trading accounts, and that value becomes the allowable cost when you dispose of them.

 Crypto capital losses

If you dispose of crypto for less than it cost you, you make a capital loss. You do not pay tax on a loss, and losses can reduce your tax bill, so it is important to keep track of them.

• Losses are first set against gains in the same tax year, even if this means wasting part of your £3,000 allowance.
• Unused losses can be carried forward with no time limit and set against future gains. Brought forward losses are only used to reduce your gains down to the annual exempt amount, so the allowance is not wasted.
• To use a loss, you must report it to HMRC within four years of the end of the tax year in which you made it. A loss made in 2022/23 must be claimed by 5 April 2027.
• Capital losses can generally only be set against capital gains, not against your salary or other income.

Many investors made crypto losses in previous years but never reported them. If you are still within the four year window, claiming them now can save tax on future gains.

 Tax on lost or stolen crypto in the UK

HMRC has clear guidance on lost and stolen crypto.

Losing your private key is not a disposal for Capital Gains Tax purposes, because the asset still exists on the blockchain. However, if you can show there is no realistic prospect of recovering access, you may be able to make a negligible value claim. If HMRC accepts the claim, you are treated as having sold and reacquired the tokens for their negligible value, which creates a capital loss you can use.

Theft is not treated as a disposal either, so stolen crypto does not automatically give you a capital loss. HMRC takes the view that you still own the tokens and have a right to recover them. There are limited exceptions, for example where you paid for crypto that was never delivered as part of a scam, or where an exchange has collapsed and there is no realistic prospect of recovery. In these cases a negligible value claim may be possible.

 Tax free crypto UK

Wondering when Bitcoin is tax free in the UK? You will not pay tax on your crypto when you are:

• Buying crypto with GBP
• Holding (HODLing) crypto, even if its value rises
• Moving crypto between your own wallets or exchange accounts
• Gifting crypto to your spouse or civil partner, provided you live together
• Donating crypto to a registered charity
• Making gains within your £3,000 annual exempt amount

Even when no tax is due, you should keep full records, because your original cost will be needed when you eventually dispose of the crypto.

 Do you pay tax when you buy, swap or sell crypto?

It depends on what you are buying with and what you do afterwards. Here is how the most common transactions are treated.

Buying crypto with GBP

You are not taxed when you buy crypto with fiat currency such as pounds sterling. However, keep a detailed record of what you paid and the fees, because this forms your cost basis.

Buying and holding crypto

You pay no tax on crypto you simply hold, however much it rises in value. For long term holders, it is worth downloading your transaction history regularly, as some exchanges only keep data for a limited period, and some have closed with little warning.

Swapping crypto for crypto

Crypto to crypto trades are taxable in the UK. If you swap Bitcoin for Ether, HMRC sees this as a disposal of your Bitcoin. It does not matter that you have not received any pounds. Your gain is the GBP market value of the Bitcoin at the time of the swap, less its cost under the pooling rules. The Ether you receive then has a cost equal to that same market value.

Buying crypto with stablecoins

Stablecoins such as USDT and USDC are cryptoassets pegged to a fiat currency, usually the US dollar. Under the current rules, spending stablecoins to buy other crypto is a crypto to crypto disposal. Gains are often small, but because stablecoins are priced in dollars, exchange rate movements against sterling can still create gains or losses. You must still keep records of these transactions.

The government has published draft legislation that would make disposals of eligible stablecoins exempt from Capital Gains Tax from 6 April 2027, with returns from lending stablecoins taxed like interest. These changes are not yet law and are expected to be confirmed through the Finance Bill.

Selling crypto for GBP

Selling crypto for GBP or another fiat currency is a disposal and Capital Gains Tax applies to any gain above your annual exempt amount, at 18% or 24% depending on your income.

Spending crypto

Paying for goods or services with crypto is also a disposal. Your proceeds are the GBP value of what you bought.

 Do you pay tax when transferring crypto?

Moving crypto between wallets or exchange accounts that you own is not a disposal, so there is no tax on the transfer itself. There are two points to watch.

Transfer fees

Wallet providers and exchanges often charge a network fee for transfers. If you pay the fee in pounds, there is no tax. If the fee is paid in crypto, which is common, HMRC’s view is that using tokens to pay the fee can be a disposal of those tokens. Fees for moving crypto between your own wallets are not an allowable cost, so they cannot be added to your cost basis.

Transfers to other people

Sending crypto to anyone other than your spouse or civil partner, without receiving something in return, is a gift and therefore a disposal at market value.

 Income Tax on crypto UK

In some situations, crypto is treated as income rather than a capital gain. Crypto income is taxed at your normal Income Tax rates and, in some cases, National Insurance contributions are also due. Crypto is usually taxed as income when it comes from:

• Being paid in crypto by an employer
• Staking rewards
• Mining rewards
• Interest from lending crypto
• Most airdrops
• Referral rewards, learn to earn and play to earn schemes
• Crypto trading where it amounts to a trade (this is rare, see below)

The amount of income is the GBP market value of the tokens when you receive them. That same value becomes your cost for Capital Gains Tax purposes when you later sell, swap or spend the tokens, so you are not taxed twice on the same value.

 How much tax will you pay on crypto income?

Crypto income is added to your other income and taxed at the normal Income Tax rates. For 2026/27, the rates in England, Wales and Northern Ireland are:

• 0% on income up to £12,570 (personal allowance)
• 20% on taxable income from £12,571 to £50,270 (basic rate)
• 40% on taxable income from £50,271 to £125,140 (higher rate)
• 45% on taxable income over £125,140 (additional rate)

Your personal allowance is reduced by £1 for every £2 of income over £100,000, so it is lost completely once your income reaches £125,140. Scottish taxpayers pay Income Tax at the Scottish rates and bands on non savings income, which are different.

To estimate the tax on your crypto income, work out which band your salary and other income already reach, then add the crypto income on top. If you earn £60,000, your crypto income is taxed at 40%. If it takes your income over £100,000, you also start to lose your personal allowance, which can create an effective rate of 60% on that slice of income.

 Getting paid in crypto by your employer

If you are paid in crypto by your employer, it counts as employment income. Where the tokens are readily convertible into cash, which is usually the case for major coins traded on exchanges, your employer must operate PAYE and deduct Class 1 National Insurance contributions through payroll. Where they are not readily convertible, Income Tax is still due but you may need to report it on your Self Assessment tax return.

 Staking, lending and DeFi crypto taxes UK

Decentralised finance (DeFi) includes lending, borrowing, staking and providing liquidity through protocols such as Aave, Compound and Uniswap. HMRC’s current guidance focuses on the “nature of the transaction”: whether a return has the nature of capital, subject to Capital Gains Tax, or the nature of income, subject to Income Tax.

HMRC says a return is more likely to be income where:

• The return has been agreed in advance, rather than being speculative or unknown
• The return is paid by the borrower or the DeFi platform
• The return is paid periodically throughout the period of lending or staking

In practice, this means that if you earn new tokens on a regular basis, for example staking rewards or interest at an advertised rate, these are likely to be income. Examples include:

• Staking rewards from proof of stake blockchains such as Ethereum or Solana
• Earning new tokens through yield farming on lending protocols
• Receiving governance tokens or reward tokens from a protocol
• Lending crypto to a centralised platform in return for interest

Lending and liquidity pools under the current rules

Under HMRC’s current guidance, lending crypto through a DeFi protocol or adding tokens to a liquidity pool is often treated as a disposal, because you usually give up beneficial ownership of the tokens. If you receive liquidity pool tokens in exchange, this is generally a disposal of the tokens you put in, and the liquidity pool tokens take on their market value as their cost. Removing liquidity can be another disposal.

Proposed changes from 6 April 2027

The government has published draft legislation that would treat lending, borrowing and liquidity pool deposits by individuals as “no gain, no loss” from 6 April 2027. Under the proposals, no tax would arise when you deposit tokens, your original cost would carry across, and tax would only arise when you make a real economic exit. These rules are still in draft and could change before they become law, so for now the current guidance applies.

 How are airdrops and forks taxed in the UK?

Airdrops

HMRC treats an airdrop as income where you received it in return for doing something, such as providing a service, completing tasks, sharing social media posts or as a reward for previous activity on a platform. The GBP value on receipt is taxed as income and becomes your cost for Capital Gains Tax.

If you receive an airdrop without doing anything in return, it is not usually income. However, you will still pay Capital Gains Tax when you later dispose of the tokens, and your base cost may be nil.

Soft and hard forks

A soft fork does not create a new asset, so there is no tax. A hard fork that creates a new token is not taxed as income when you receive the new tokens. Instead, the cost of your original tokens is split between the original and new tokens on a just and reasonable basis. Capital Gains Tax then applies when you dispose of either.

 Crypto mining tax UK

Crypto mining can be treated as a hobby or as a business. This depends on factors such as:

• The degree of activity
• The level of organisation
• The risk involved
• How commercial the activity is

Mining as a hobby

If your mining is a hobby, the GBP market value of the tokens you receive is taxed as miscellaneous income on your Self Assessment tax return. You may be able to deduct appropriate expenses that are directly related to the mining. When you later sell the tokens, Capital Gains Tax applies to any increase in value since you received them.

Mining as a business

If your mining amounts to a trade, the rewards form part of your trading profits and are subject to Income Tax and Class 4 National Insurance contributions. Allowable expenses such as electricity and equipment can be deducted, and the tokens are treated as trading stock, so gains on disposal also form part of your trading profits.

 Is crypto trading a business?

HMRC takes the view that buying and selling crypto as an individual is unlikely to amount to a trade in most cases. It compares frequent personal crypto trading to gambling or investing in shares, which are rarely trades. Only in exceptional cases, with a high level of activity, organisation and commerciality similar to a professional trading business, would profits be taxed as trading income. For most people, Capital Gains Tax applies, even if they trade frequently.

If you also use prediction markets, see our Polymarket and Kalshi UK tax guide, as different rules can apply.

 Are NFTs taxed in the UK?

Non fungible tokens (NFTs) are generally treated in the same way as other cryptoassets. Selling, swapping or gifting an NFT is a disposal for Capital Gains Tax. However, NFTs are not fungible, so each one is a separate asset with its own cost, rather than being pooled. If you create and sell NFTs regularly, for example as an artist or content creator, the income may be trading income.

 Crypto gifts and donations tax

Gifting crypto is a disposal for Capital Gains Tax, but there are important exceptions for spouses and charities.

Gifting crypto to a friend or family member

If you give crypto to anyone other than your spouse or civil partner, including your children, you are treated as disposing of it at its GBP market value on the date of the gift. You pay Capital Gains Tax on any gain, even though you received nothing. The recipient takes that market value as their cost.

If Income Tax has already been charged on the value of the tokens you gift, for example staking rewards, section 37 of the Taxation of Chargeable Gains Act 1992 prevents the same amount being taxed twice. The proceeds are reduced by the amount already taxed as income.

Gifting crypto to your spouse or civil partner

Transfers between spouses and civil partners who live together are made on a “no gain, no loss” basis, so no tax arises and there is no limit on the amount. Your spouse takes over your original cost. Following separation, the same treatment continues until the end of the third tax year after the year you stop living together, or longer if the transfer is part of a formal divorce agreement.

This is one of the most useful planning points available. Moving crypto to a spouse before a sale allows a couple to use two £3,000 allowances and, where one partner has a lower income, to have more of the gain taxed at 18% rather than 24%.

Donating crypto to charity

Gifts of crypto to a registered charity are treated as “no gain, no loss”, so there is no Capital Gains Tax to pay on the donation. However, cryptoassets are not qualifying investments for Income Tax relief, so you cannot claim Income Tax relief on the value of the gift in the way you can for listed shares.

 Crypto and Inheritance Tax

Crypto forms part of your estate for Inheritance Tax purposes, in the same way as cash, shares and property. Its value at the date of death is included, and Inheritance Tax at 40% can apply to the value of your estate above the available nil rate bands. Your beneficiaries inherit the crypto at its market value at the date of death, so gains that built up during your lifetime are not subject to Capital Gains Tax.

Make sure your executors know that you hold crypto and how it can be accessed securely. Crypto held in a self custody wallet can be lost permanently if no one can access the private keys.

 Crypto tax if you move to or leave the UK

UK residents pay UK tax on their worldwide gains, including crypto. HMRC treats cryptoassets as located where the owner is resident, so moving your crypto to a foreign exchange does not take it outside UK tax.

If you leave the UK and dispose of crypto while you are non resident, the temporary non residence rules can bring those gains back into UK tax if you return within five years. The non domicile and remittance basis regime was abolished from 6 April 2025 and replaced with a residence based regime, which offers a four year exemption on foreign income and gains to some new arrivals. If you are planning a move, take advice before selling.

 Can HMRC track crypto?

Yes. HMRC can and does track cryptocurrency.

For several years HMRC has used its legal powers to obtain customer data from crypto exchanges operating in the UK, including information collected through Know Your Customer (KYC) identity checks. It has used this data to send tens of thousands of “nudge” letters to crypto investors, reminding them to report gains and income and asking them to check their tax returns.

HMRC has made data requests to major platforms over the years, so you should assume that HMRC can see activity on any centralised exchange you use, including Binance, Kraken, Crypto.com, Gemini, eToro and Revolut.

 The Cryptoasset Reporting Framework (CARF)

From 1 January 2026, the UK has implemented the Cryptoasset Reporting Framework, an international standard agreed by the OECD. Under CARF:

• UK crypto service providers, such as exchanges and brokers, must collect your details, including your name, address, date of birth and National Insurance number or Unique Taxpayer Reference.
• They must report your transactions to HMRC every year. The first reports, covering the 2026 calendar year, are due by 31 May 2027.
• The UK will automatically exchange this information with tax authorities in other participating countries, and receive information about UK residents using overseas platforms.
• You can be charged a penalty if you do not give your crypto provider the information it needs.

This means HMRC will be able to match transactions directly against tax returns. If your crypto activity has not been reported, now is the time to put it right.

 Centralised and decentralised exchanges

How easily HMRC can see your activity depends on the type of platform you use.

Centralised exchanges, such as Coinbase, Kraken and Binance, carry out KYC identity checks, so your trades can be linked to you. These platforms fall within CARF reporting.

Decentralised exchanges, such as Uniswap or PancakeSwap, do not usually require KYC. Activity through self custody wallets is harder for HMRC to trace directly, but it is still fully taxable. Transactions on public blockchains are permanent, and funds usually pass through a centralised exchange or a bank account at some point. Large deposits of crypto or cash with no clear source can trigger questions from your bank or HMRC.

 When do you need to report your crypto taxes to HMRC?

The UK tax year runs from 6 April to 5 April the following year. You report crypto gains and income on your Self Assessment tax return for the tax year in which they arose.

You need to report crypto on a tax return if:

• Your total gains from all assets are above the £3,000 annual exempt amount
• Your total disposal proceeds from all assets are more than £50,000, even if your gains are below the allowance
• You want to claim a capital loss
• You received crypto income, such as staking or mining rewards, above any allowances or that was not taxed through payroll

Since the 2024/25 tax year, the capital gains pages of the tax return (SA108) include a separate section for cryptoassets, so crypto gains are reported separately from shares and other assets.

Key dates for the 2025/26 tax year (6 April 2025 to 5 April 2026):

• 5 October 2026: deadline to register for Self Assessment if you have not filed before
• 31 January 2027: deadline to file your online tax return
• 31 January 2027: deadline to pay the tax due

For the 2026/27 tax year, the online filing and payment deadline is 31 January 2028. Use our Self Assessment tax return checklist to make sure nothing is missed.

 How to pay tax on cryptocurrency UK

Once you have filed your Self Assessment tax return reporting your crypto gains and income, HMRC will calculate how much tax you owe. Your balancing payment is due by 31 January following the end of the tax year.

If your Self Assessment bill is more than £1,000, you may also have to make payments on account towards the next year’s tax, due on 31 January and 31 July. Capital Gains Tax is not included in payments on account, but Income Tax on crypto income is.

We recommend filing early so you know the amount well before the deadline. Interest and penalties for late filing and late payment apply if you miss the deadlines.

 What records does HMRC expect you to keep?

HMRC is clear that the responsibility for keeping crypto records rests with you, not the exchange. For each transaction, you should keep:

• The type of cryptoasset
• The date of the transaction
• Whether it was a purchase, sale, swap, transfer or receipt of income
• The number of units involved
• The value of the transaction in pounds sterling
• A running total of the units held
• Bank statements and wallet addresses, which may be needed in an enquiry

Download reports from your exchanges regularly, as platforms can close, change or delete historic data. HMRC can usually open an enquiry into returns for up to four years, six years where there has been carelessness and 20 years for deliberate behaviour. Read more in our article on how far back HMRC can investigate.

 What if you have not declared crypto in the past?

If you have made crypto gains or received crypto income in previous years and not reported them, you should put this right as soon as possible. HMRC has an online disclosure service for unpaid tax on cryptoassets.

Penalties depend on whether the error was careless or deliberate and whether you came forward before HMRC contacted you. An unprompted disclosure of a careless error can result in no penalty at all, while deliberate and concealed errors can attract penalties of up to 100% of the tax, and more where offshore matters are involved. Interest is charged on late paid tax in all cases.

If you have received a nudge letter or an enquiry, we can help. Find out more about our HMRC tax investigations service.

 How to reduce your crypto tax UK legally

There are several legal ways to reduce your crypto tax. Most need to be in place before the end of the tax year on 5 April, so plan ahead.

• Use your annual exempt amount every year: spreading disposals across tax years lets you use the £3,000 allowance more than once.
• Transfer crypto to your spouse or civil partner: this can double the allowance and make use of a lower rate band.
• Claim capital losses: report losses within four years so they can be set against current and future gains.
• Make negligible value claims: claim relief for tokens that have become worthless, such as coins from failed projects.
• Sell in a lower income year: if your income will be lower, for example during a career break, more of your gain may be taxed at 18%.
• Make pension contributions: personal pension contributions extend your basic rate band, which can bring more of your gain into the 18% rate and help restore your personal allowance if your income is over £100,000.
• Watch the 30 day rule: selling and buying back within 30 days will not crystallise a loss against your pool cost.
• Keep a record of every allowable cost: exchange fees and professional costs reduce your gain.
• Donate to charity: gifts of crypto to registered charities are free of Capital Gains Tax.
• Consider tax wrappers for future investment: crypto exchange traded notes (ETNs) can now be held in some ISAs, where gains are tax free. Direct holdings of crypto cannot be held in an ISA.

For a wider view, see our guide on smart tax strategies for high earners.

 Frequently asked questions

Q: Do I pay tax on crypto if I do not cash out to GBP?

A: Yes. Swapping one cryptoasset for another, spending crypto or gifting it is a disposal for Capital Gains Tax, even if you never convert to pounds.

Q: How much crypto profit is tax free in the UK?

A: For 2026/27, the first £3,000 of total capital gains is tax free. This allowance is shared with any other gains you make, such as from shares.

Q: What is the Capital Gains Tax rate on crypto in 2026/27?

A: 18% on gains within your unused basic rate band and 24% on gains above it.

Q: Do I need to report crypto if I made a loss?

A: You are not required to report a loss, but you should, because a loss can only be used if it is claimed within four years of the end of the tax year in which it arose.

Q: Does HMRC know about my crypto?

A: Very likely. HMRC receives data from exchanges and, under CARF, UK platforms report users’ transactions to HMRC each year from 2026, with overseas data shared through international agreements.

Q: Are staking rewards taxed as income?

A: Generally yes. Staking rewards are taxed as income at their GBP value when you receive them, and Capital Gains Tax applies to any increase in value when you later dispose of them.

Q: Can I gift crypto to my spouse tax free?

A: Yes. Transfers between spouses and civil partners who live together are on a “no gain, no loss” basis, so no tax arises at the time of the transfer.

Q: What happens if I have not declared crypto gains in previous years?

A: You should make a disclosure to HMRC as soon as possible. Coming forward before HMRC contacts you usually results in lower penalties.

 Appoint TaxQube to manage your crypto taxes

Being a regulated firm of specialist tax accountants, we look after a large number of professionals from various industries, including high earners who invest in crypto alongside shares and other assets. We calculate your gains under the UK pooling rules rather than relying on exchange reports, report staking and DeFi income correctly and help you claim every allowance and loss available.

Unlike some firms, we do not take a share of your tax savings; you keep 100% of them. We charge an all inclusive monthly retainer with no additional invoices, giving you year round access to qualified tax advisers.

If you hold crypto, have received an HMRC nudge letter or need to bring your crypto tax up to date, contact us for a free initial consultation.