HMRC reminds crypto investors to declare gains

HMRC is paying closer attention to cryptoassets, and if you have made money from crypto, you may need to report it correctly. This can include gains from selling, exchanging, gifting or using cryptoassets, even where you have not withdrawn the money into your bank account.

For many people, crypto tax feels unclear. You may have bought Bitcoin, Ethereum, NFTs, stablecoins or other tokens without thinking of yourself as an investor. You may also have moved assets between wallets, swapped one token for another, or received rewards through staking or mining.

The important point is simple. If you have made taxable gains or received taxable income from cryptoassets, HMRC expects you to check your position and report what is due.

With the Capital Gains Tax annual exempt amount at £3,000 for individuals in the 2026 to 2027 tax year, more crypto investors may fall within the reporting rules than in previous years.

When crypto gains may need to be reported

In most cases, individuals who buy and sell crypto are treated as investors rather than traders. This usually means Capital Gains Tax may apply when you dispose of cryptoassets and make a gain.

A disposal can include:

• Selling crypto for £.
• Exchanging one cryptoasset for another.
• Using crypto to pay for goods or services.

Giving crypto to another person, unless it is a gift to your spouse, civil partner or charity.

This is where many people make mistakes. You do not always need to convert crypto back into £ for a taxable event to happen. For example, swapping Bitcoin for Ethereum can still count as a disposal.

If your total gains for the tax year are above the Capital Gains Tax allowance, you may need to report the gain and pay tax. Your total gains can include crypto, shares, funds, property and other chargeable assets.

If you already complete a Self Assessment return, FHP Accounting can help you review the figures through its personal tax returns service.

Crypto income is not the same as crypto gains

Not every crypto transaction is taxed in the same way. Some crypto activity may be treated as income rather than a capital gain.

This can include crypto received from employment, mining, staking, lending rewards or other reward-based activity. In these situations, Income Tax and National Insurance may need to be considered.

This matters because the tax treatment can affect how much you owe. A gain made from selling an investment is different from income received for work, services or rewards.

If you run a business and receive crypto, the tax position can become more involved. You may need help with company tax returns, bookkeeping, VAT, payroll and annual accounts.

For new businesses, it is worth getting advice early. FHP Accounting’s accountants for start-ups can help you set up clear systems before your records become difficult to manage.

Why good crypto records matter

Crypto records can become messy very quickly. You may have used several exchanges, wallets and platforms. You may also have paid fees, made transfers, swapped tokens or received rewards at different values.

HMRC expects crypto figures on a Self Assessment return to be reported in pounds sterling. From the 2024 to 2025 tax year onwards, Self Assessment returns include a specific cryptoasset section.

Good records should usually include:

• Date of each transaction.
• Type of cryptoasset involved.
• Number of tokens bought, sold, exchanged or received.
• Value in £ at the time of the transaction.
• Fees paid.
• Wallet and exchange details.
• Purpose of the transaction.

Exchange reports can help, but they are not always complete tax calculations. They may not correctly account for transfers between wallets, pooled costs, same-day rules or the 30-day matching rule.

This is why organised bookkeeping is important. If you already use cloud accounting, FHP Accounting can also support you with Xero bookkeeping so your wider records stay clean and easy to follow.

How Capital Gains Tax can apply to crypto

For the 2026 to 2027 tax year, the Capital Gains Tax annual exempt amount is £3,000 for individuals. This means you only pay Capital Gains Tax if your total taxable gains, after allowable losses and reliefs, are above the allowance.

If you are a basic rate taxpayer, gains made from 6 April 2026 are generally charged at 18% where the gain falls within the basic rate band. Any part above the basic rate band is generally charged at 24%.

For example, if your total taxable crypto gain is £8,000, the first £3,000 may be covered by your annual exempt amount. The remaining £5,000 may then be taxable, depending on your income, other gains and personal circumstances.

This is why your crypto position should not be reviewed in isolation. Employment income, self-employment income, dividends, rental income, share disposals and other gains can all affect the final calculation.

If you also have property income, FHP Accounting’s property tax accountants can help you understand how crypto gains sit alongside your wider tax position. If you let property, support from a landlord accountant can also help you keep rental income and investment records in order.

What has changed with crypto reporting

HMRC now has clearer ways to identify crypto activity. UK cryptoasset service providers must collect certain user and transaction data under the Cryptoasset Reporting Framework. From 1 January 2026, UK reporting cryptoasset service providers must carry out due diligence on customers and report relevant cryptoasset transaction data to HMRC.

Crypto users may also need to provide identifying details to service providers, including name, date of birth, address and tax identification details such as a National Insurance number or Unique Taxpayer Reference.

This does not mean every crypto investor has done something wrong. It does mean HMRC is likely to have more information available when checking whether gains and income have been reported correctly.

If you have made gains, received crypto income or missed earlier reporting, it is better to deal with the issue before HMRC contacts you.

What if you have not declared crypto before?

If you think you should have declared crypto gains or income in an earlier tax year, do not ignore it. HMRC has a disclosure service for unpaid tax on cryptoassets, including exchange tokens, NFTs and utility tokens.

You may need to gather:

• Exchange records.
• Wallet addresses.
• Transaction history.
• Details of proceeds and income.
• Acquisition costs.
• Allowable fees and expenses.
• Calculations of gains, income, tax and interest.

The number of years you need to disclose can depend on why the tax was not reported. HMRC may charge interest and penalties where tax has not been paid correctly, so it is sensible to get advice before submitting anything.

Crypto tax for limited companies and business owners

Businesses also need to treat crypto carefully. If your company accepts crypto payments, holds cryptoassets, pays suppliers in crypto or receives crypto-related income, you may need to consider Corporation Tax, VAT, accounting treatment and record keeping.

This can be especially important where crypto values move between the invoice date, payment date and conversion date.

FHP Accounting can support limited companies with annual statutory accounts, VAT return services and payroll services where crypto activity links to wider business reporting.

If you want regular support throughout the year, an outsourced finance department can help you keep tax deadlines, reconciliations and financial reporting under control.

How FHP Accounting can help

Crypto tax does not need to feel overwhelming, but it does need to be handled properly. HMRC’s reporting expectations are clearer, the £3,000 Capital Gains Tax allowance is relatively low, and more information is now being collected by cryptoasset service providers.

FHP Accounting can help you review your crypto transactions, understand whether gains or income need to be reported, calculate your position in £ and prepare the relevant tax return entries.

You can also get support with management accounts if you want a clearer view of business performance, or tax planning if crypto forms part of your wider investment or business strategy.

If you are unsure whether you need to report crypto gains, crypto income or earlier undeclared activity, speak to FHP Accounting for clear, practical advice.

Contact FHP Accounting today to book your consultation and get your crypto tax position reviewed before your next Self Assessment deadline.