Cryptocurrency Tax Returns UK
UK Crypto Tax Returns – Report Your Gains to HMRC with Ease
If you trade cryptocurrencies, you are required to report your profits to HMRC. Annual gains of up to £6,000 are tax-free – all you need is a proper tax return. Simply complete a short form to receive a quote for your return. Our estimates are provided free of charge.
Crypto Tax – Done Right, Without the Hassle
We offer comprehensive cryptocurrency tax return services for individuals trading in the UK. No matter how many exchanges you use or how many transactions you made in the last tax year – we can handle it all. A detailed service quote will be provided after you submit the form.
Your Crypto Accountant at Sepera Accounting
Our dedicated crypto accountant works at Sepera Accounting and understands the nuances of reporting transactions from multiple exchanges, wallets, and blockchains. This expertise is essential for submitting an accurate tax return to HMRC. We have the know-how and a reliable team of accountants who support investors across the UK – from beginners to seasoned traders. Let us take the stress out of your crypto tax obligations.
Get a quote for your HMRC tax return
UK Crypto Tax Explained:
Common Questions & Practical Answers
Declare Crypto Profits in the UK?
Yes. If you trade cryptocurrencies in the UK, you must report your transactions and profits to HMRC every year. This applies in the same way as reporting gains from other types of investments. Once you exceed the annual Capital Gains Tax (CGT) allowance, you’re required to pay tax on your profits. Contrary to common belief, cryptocurrency trading is not anonymous. The Finance Act 2011 gives HMRC the right to request user data from exchanges. This has already happened – for instance, Coinbase shared user data in late 2021, as did two other FCA-regulated platforms.
UK regulations require traders to declare their crypto income. Moreover, doing so comes with several advantages that many traders are unaware of.
How Are Crypto Traders Taxed?
Profits from cryptocurrency trading are generally treated as Capital Gains. You must report them on your annual Self Assessment tax return, covering the period from 6 April to 5 April the following year. Alternatively, you can report crypto profits using the Capital Gains Tax Real Time Service. However, this method is not practical for those making multiple trades throughout the year.
What Transactions Must Be Declared?
You must report the following crypto-related activities for CGT purposes:
- Exchanging crypto for fiat currencies (e.g. GBP)
- Swapping one cryptocurrency for another
- Using crypto to pay for goods or services (e.g. via crypto-linked cards)
- Gifting crypto to someone other than your spouse or civil partner
You need to include all exchanges used in the tax year and every transaction on each platform. Most exchanges allow you to export your transaction history.
What Doesn't Qualify for CGT?
Some activities aren’t subject to CGT, but they may still be taxable:
- Mining cryptocurrency
- Receiving airdrops
- Receiving crypto as payment for services or as part of employment
These are typically treated as income, not capital gains. Depending on the case, they may be subject to Income Tax and National Insurance contributions.
What Is Taxed When Trading Crypto?
You are taxed on the profit made – that is, the difference between the purchase and sale price, minus any transaction fees. Deposits into exchanges are not considered part of the calculation.
Crypto CGT Rate in the UK?
Capital gains from crypto are taxed at 10% or 20%, depending on your overall income.
You must declare your gains for the tax year, which runs from 6 April to 5 April.
Who’s Exempt from Paying CGT?
If your total gains for the year are under £12,300, you don’t pay any CGT. For couples filing separately, each person gets the full allowance. That means lower-profit traders can earn up to £12,300 in gains per tax year tax-free.
What If I Made a Loss Trading Crypto?
If you make a loss, you don’t owe tax – but it’s still wise to declare it. Reported losses can be carried forward indefinitely to reduce CGT in future years. They can also offset gains from other assets in the same tax year.
What If I Use Non-UK Exchanges?
FCA-regulated UK exchanges like Binance, Coinbase, Gemini, eToro, and Revolut must provide user data to HMRC when requested. However, UK residents must report profits from all exchanges worldwide.
For tax purposes, crypto is considered to be held where the owner resides – not where the exchange is based.
What If I Swap Crypto Only?
Even if you don’t convert crypto to fiat, swapping one crypto for another is still a taxable event. For example, exchanging Bitcoin for Ethereum creates a gain or loss, which is calculated based on the GBP value at the time of the transaction.
How Is Mining Taxed?
If you mine cryptocurrency, you may need to pay Income Tax, especially if it’s part of your trade, job, or service. You don’t report mined coins as capital gains at that stage. However, if you later sell or trade those coins, then CGT applies on the resulting profits.
