Cryptoassets are taxed in the UK under ordinary tax law: there is no separate "crypto tax", but HMRC's Cryptoassets Manual applies capital gains tax, income tax and, from January 2026, international data reporting to them in specific ways. This guide sets out the rules that apply for the 2026/27 tax year, written for UK-resident individuals who hold, trade, stake or have previously undeclared crypto.
Everything here reflects HMRC guidance and legislation as at August 2026. It is general guidance, not advice on your own position — the FAQ at the end covers the questions we are asked most often.
Do you pay tax on crypto in the UK?
For almost everyone, yes — through capital gains tax when you dispose of tokens. HMRC's settled view is that individuals buying and selling crypto are investors, and that trading status applies "only in exceptional circumstances", judged on the same case law as share trading. That matters because it means gains are usually within CGT, not income tax — and it also means losses are capital losses, not trading losses.
A disposal is wider than cashing out to pounds. Swapping one token for another, spending crypto on goods or services, and gifting it to anyone other than your spouse, civil partner or a charity are all disposals at the sterling market value on the day.
CGT rates and the £3,000 allowance for 2026/27
The annual exempt amount stays at £3,000 for 2026/27. Above it, gains within your unused basic rate band are taxed at 18%, and the rest at 24%.
| 2026/27 | Rate / amount |
|---|---|
| Annual exempt amount | £3,000 |
| Gains within unused basic rate band | 18% |
| Gains above the basic rate band | 24% |
| CARF user penalty (missing or inaccurate details) | up to £300 |
How gains are calculated: pooling and matching
Each type of token has its own section 104 pool with an average cost. Disposals are matched first against acquisitions on the same day, then against acquisitions in the following 30 days (the "bed and breakfast" rule, earliest first), and only then against the pool. NFTs are separately identifiable and are not pooled.
When crypto is income instead
- Employment — crypto paid by an employer is "money's worth"; exchange tokens are readily convertible assets, so PAYE and National Insurance apply.
- Mining and staking — unless the activity amounts to a trade, rewards are miscellaneous income at their sterling value on receipt, with CGT again on a later disposal. Up to £1,000 a year can be covered by the trading and miscellaneous income allowance.
- Airdrops — not income if you received them without doing anything in return and outside any trade; income if they were received for, or in expectation of, a service. Selling them is a CGT disposal either way.
DeFi lending and staking
Where you lend or stake tokens through a platform and beneficial ownership of the tokens passes to the platform or borrower, HMRC treats that as a disposal at that point — the much-discussed "phantom gain". The returns you earn are not interest for tax purposes, because cryptoassets are not money. A no-gain/no-loss relief for individuals was still only "under consideration" at the Autumn Budget 2025 consultation response, so the current rules remain live law: whether a particular protocol triggers a disposal is a question of fact and worth taking advice on before you commit large positions.
CARF: HMRC will see your data
The Cryptoasset Reporting Framework took effect in the UK on 1 January 2026. UK cryptoasset service providers must now collect verified details from their users — name, date of birth, address and National Insurance number or UTR — together with transaction data, and make their first reports to HMRC between 1 January and 31 May 2027 covering the whole of calendar year 2026. Users who fail to provide details, or provide inaccurate ones, face a penalty of up to £300. UK-resident users are within scope of domestic reporting, so exchanges' data on 2026 activity will reach HMRC whether or not it appears on a return. HMRC has already been writing "nudge" letters based on exchange data for several years.
Losses, scams and lost keys
- Capital losses — claim on your return or in writing within four years of the end of the tax year of the disposal. Same-year gains are offset first; the excess carries forward.
- Worthless tokens — a negligible value claim can crystallise a loss where tokens you genuinely acquired have become worthless — but it must cover the whole section 104 pool, and it cannot work for tokens that were worthless when you bought them.
- Theft and scams — theft is not a disposal, so stolen crypto does not automatically create a loss. The analysis depends on exactly what you acquired and what failed; take advice before claiming.
- Lost keys — losing a private key is not a disposal; if recovery is genuinely impossible a negligible value claim may be available.
Reporting, and putting past years right
The Self Assessment capital gains pages have carried a dedicated cryptoassets section since the 2024/25 return, so crypto disposals are now separately visible to HMRC. If you have undeclared gains or income from earlier years, HMRC's cryptoasset disclosure facility is the route to correct them: assessment reaches back four years where you took reasonable care, six where you were careless, and up to twenty for deliberate behaviour, with interest running daily and behaviour-based penalties. Disclosing before HMRC contacts you generally reduces the penalty materially.
Records HMRC expects you to keep
- The type of token, and dates of each transaction
- Numbers of units disposed of and remaining, and sterling values at each date
- Bank statements, wallet addresses and exchange records
- The pooled cost before and after each disposal — exchange reports alone are not enough
Frequently asked questions
Do I pay tax when I swap one crypto for another?
Yes — a token-for-token exchange is a CGT disposal even though no pounds change hands. The gain is calculated using sterling values on the date of the swap.
What rate will I pay on crypto gains in 2026/27?
18% on gains within your unused basic rate band and 24% above it; higher and additional rate taxpayers pay 24%. Your first £3,000 of total gains in the year is exempt.
Are staking and mining rewards taxable?
Yes — unless the activity amounts to a trade, the sterling value at receipt is miscellaneous income, and there may be CGT again when you later dispose of the rewards. Up to £1,000 a year may be covered by the trading allowance.
Will HMRC know about my crypto?
From 1 January 2026 UK providers must collect verified user and transaction data under CARF, with first reports reaching HMRC between January and May 2027. HMRC already writes to crypto holders using exchange data.
My exchange asked for my National Insurance number — do I have to give it?
Yes. Providers must collect your name, date of birth, address and NINO or UTR, and HMRC can charge you up to £300 for missing or inaccurate details.
I was scammed or my crypto was stolen — can I claim the loss?
Not automatically: theft is not a disposal. A negligible value claim may be available where tokens you genuinely acquired became worthless — but not where they were worthless from the start.
What if my gains are under £3,000?
No CGT is due for 2026/27, but keep full records — and if you already file Self Assessment you may still need to complete the capital gains pages depending on your circumstances.
I haven't declared past crypto gains — what should I do?
Use HMRC's cryptoasset disclosure facility before HMRC contacts you. Assessment covers four, six or up to twenty years depending on behaviour, plus daily interest and behaviour-based penalties — early disclosure generally means lower penalties.
This guide states the position as at 14 August 2026 and is general information for UK residents, not advice on any individual's affairs. Rates and HMRC practice change; take advice before acting. TaxDigit Ltd, chartered certified accountants, Guildford.
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