Crypto Tax in the UK: HMRC Rules, CGT Rates and Share Pooling

General information, not tax advice. HMRC guidance evolves and individual circumstances vary. Check gov.uk or speak to a qualified adviser before you file.

There is no UK crypto tax as such. HMRC folds cryptoassets into the existing system: if you hold them as an investment, disposals fall under Capital Gains Tax; if you receive tokens as a reward for something, that is Income Tax. Only in rare cases does activity reach the level of a financial trade. Nearly everyone reading this is an investor for tax purposes, however actively they trade — HMRC sets that bar deliberately high.

What counts as a disposal

• •Selling crypto for pounds.
• •Exchanging one token for another — a disposal at market value in sterling, even though no fiat moved.
• •Spending crypto on goods or services.
• •Gifting crypto to anyone other than a spouse or civil partner.

Not disposals: buying and holding, moving coins between your own wallets, and transfers to a spouse or civil partner, which pass at no gain and no loss and effectively let a couple use two allowances.

Allowance and rates

The Capital Gains Tax annual exempt amount is £3,000 for both 2025/26 and 2026/27. Gains within that are free of CGT. Above it, crypto is taxed at 18% for gains falling within your basic rate band and 24% above it — rates that took effect for disposals on or after 30 October 2024, replacing the previous 10% and 20%.

The mechanic that surprises people: the rate depends on your total income plus gains. You stack the gain on top of your income, and the portion that spills over the basic rate threshold is taxed at 24% while the rest stays at 18%. A single gain can therefore straddle both rates.

The allowance has fallen sharply from £12,300 a few years ago, which means far more ordinary investors now have a filing obligation than did under the old regime — and the reporting requirement can bite even where little tax is due.

Share pooling: which coins did you actually sell?

If you bought BTC five times at five prices and sold some, which purchase did you sell? HMRC answers with matching rules, applied in order, exactly as it does for shares. Getting this wrong is the most common source of incorrect UK crypto returns.

• •Same-day rule — disposals are matched first against acquisitions made the same day.
• •30-day rule (the bed-and-breakfasting rule) — next, matched against acquisitions in the 30 days after the disposal, earliest first. This is what stops you from selling to crystallise a loss and immediately buying back.
• •Section 104 pool — anything left is matched against the pool: all your remaining holdings of that token, merged into a single averaged cost. Each token gets its own pool, so BTC, ETH and SOL are tracked separately.

The pool works on a weighted average. Buy 1 BTC at £20,000 and 1 BTC at £30,000 and the pool is 2 BTC at £50,000, an average of £25,000 each. Sell 1 BTC for £40,000 and the gain is £15,000, regardless of which coin you feel you sold. NFTs are the exception — they are not fungible, so they are not pooled and the matching rules do not apply.

Staking, mining and airdrops

Where these do not amount to a trade, HMRC treats the tokens as miscellaneous income, taxed at your marginal Income Tax rate on the sterling value when received. The £1,000 trading and miscellaneous income allowance covers small amounts. Above that you have obligations: notify HMRC where such income is between £1,000 and £2,500, and register for Self Assessment above £2,500.

For 2026/27 the marginal rates are the standard ones — a £12,570 personal allowance, 20% to £50,270, 40% to £125,140 and 45% above. National Insurance may also apply depending on the nature of the activity.

Then it happens twice. Receiving a reward is income; later selling it is a disposal, with the value already taxed as income becoming your acquisition cost. Airdrops received purely for holding, with nothing given in return, may escape the income charge but still enter the pool at nil or market cost for CGT — a distinction worth checking against the specific facts.

Losses

Capital losses offset gains in the same year, and unused losses carry forward indefinitely — but only if you claim them, and the claim window is four years from the end of the tax year in which the loss arose. Reporting a loss year you would otherwise skip is often worth the paperwork purely to bank the loss.

For tokens that have become genuinely worthless rather than merely cheap, a negligible value claim can crystallise the loss without a disposal. Coins lost to a forgotten private key are treated differently again: HMRC's position is that you still own them, so there is no disposal — a negligible value claim is the route, not a straightforward loss.

Reporting and deadlines

• •Self Assessment — report gains in the return for the tax year of disposal (6 April to 5 April), filed and paid by 31 January following the tax year end.
• •Real-time CGT service — for non-property gains you can report by 31 December in the tax year after the gain and pay by 31 January. A 2025/26 gain, for example, is reported by 31 December 2026 and paid by 31 January 2027. It is unavailable if you are already in Self Assessment, in which case the gain goes in the return.
• •Records to keep: date, token type, quantity, sterling value at the time, running pool cost, wallet addresses and bank statements. HMRC expects you to be able to substantiate every line.

CARF: HMRC is now getting the data

The Cryptoasset Reporting Framework took effect on 1 January 2026 under SI 2025/744. UK crypto service providers must now collect identifying information from users — name, address, date of birth, National Insurance number, tax residence — along with transaction detail. The first reports covering calendar 2026 are due to HMRC between January and May 2027, and the framework is being extended to domestic UK users as well as cross-border ones.

Practically, HMRC's crypto nudge letters were already going out based on exchange data requests. From 2027 the reporting is systematic. The window in which non-reporting went unnoticed has closed.

What is still unsettled

DeFi remains the messy corner. Under current rules, depositing tokens into a lending or staking arrangement can itself be a disposal if beneficial ownership passes — which can generate a dry tax charge on assets you never sold. A no-gain-no-loss treatment for certain DeFi arrangements was floated at the Autumn Budget 2025, but it is a proposal under consultation, not enacted law. Do not plan around it, and get advice if you are running meaningful DeFi positions.