UK Crypto Tax: A Plain-English Guide to Self Assessment

HMRC has been clear for years now: cryptocurrency is taxable. If you've bought, sold, swapped, or earned crypto, there's a good chance you owe tax on it.

Here's how it actually works, in plain English.

Capital Gains Tax: the basics

When you sell, swap, or give away cryptocurrency, you may owe Capital Gains Tax (CGT) on any profit. The profit is the difference between what you paid for the crypto and what it was worth when you disposed of it.

For the 2025/26 tax year, the annual CGT exempt amount is £3,000. That means you can make up to £3,000 in gains before you owe anything. Above that threshold, the rates are:

• 10% for basic rate taxpayers (or 18% on residential property, but that's not relevant here)
• 20% for higher and additional rate taxpayers (or 24% on residential property)

Note: these rates apply to gains above the exempt amount, not your total gains.

What triggers Capital Gains Tax

The following activities are disposals for CGT purposes:

• Selling crypto for fiat — selling Bitcoin for GBP
• Swapping one crypto for another — exchanging ETH for USDC
• Spending crypto — buying goods or services with Bitcoin
• Gifting crypto — giving tokens to someone (unless it's to your spouse or civil partner)

Simply moving crypto between your own wallets is not a disposal.

Income Tax: when crypto counts as income

Some crypto activities are treated as income rather than capital gains:

• Staking rewards — taxed as income when received
• Mining income — taxed as income at fair market value
• Airdrops — taxed as income if received in return for a service, otherwise as capital gains
• Payment for services — if you're paid in crypto for work, that's employment or self-employment income
• DeFi lending interest — generally treated as income

Income tax rates for 2025/26 are 20% (basic), 40% (higher), and 45% (additional rate), applied to your total income including crypto.

Self Assessment: what forms you need

If you have crypto gains or income to report, you'll need to file a Self Assessment tax return. The key forms are:

• SA100 — the main Self Assessment form
• SA108 — the Capital Gains supplementary page, where you report your crypto disposals

If you have crypto income (staking, mining, etc.), it goes on the relevant income pages of your SA100.

You can file online through HMRC's portal, or through commercial software, or your accountant can file on your behalf.

The deadlines

For the 2025/26 tax year (6 April 2025 to 5 April 2026):

• 31 October 2026 — deadline for paper Self Assessment returns
• 31 January 2027 — deadline for online Self Assessment returns and payment

Miss the January deadline and you'll face an automatic £100 penalty, with additional penalties if you're more than three months late.

HMRC is paying attention

HMRC has been requesting bulk data from UK crypto exchanges since 2019. They know who has been trading. In 2024, HMRC launched "nudge letters" to crypto holders, prompting them to check their tax position.

If you haven't reported crypto gains in previous years, HMRC may already have the data. Voluntary disclosure is always better than waiting for them to come to you.

Record keeping

HMRC requires you to keep records of all your crypto transactions for at least 5 years after the filing deadline. This includes:

• Dates of transactions
• Number of tokens involved
• Value in GBP at the time
• Exchange or wallet addresses
• Any fees paid

Koinly and similar software can help generate these records, but the data needs to be clean and complete.

How we help

We prepare HMRC-ready capital gains summaries that map directly to the SA108 form. We reconcile your exchanges, fix the errors, and deliver a report your accountant can work from — or, if you're using our UK filing service, we handle the filing too.

Need HMRC-ready reports? Get a quote and we'll prepare everything you need for Self Assessment.