HMRC is set to receive significantly more information about UK cryptoasset users through new international reporting requirements. If you have previously traded, invested in, or received cryptoassets, now may be the time to review whether any income or gains have been reported correctly.

HMRC has published its first official statistics on taxable gains from cryptoassets, covering the 2024/25 tax year.

In total, 17,600 individuals reported taxable cryptoasset gains, with total gains amounting to £1.38 billion. Of those, 240 individuals reported gains exceeding £1 million, accounting for £717 million of the total.

While these figures are interesting in themselves, they also send a clear message: cryptoassets are firmly on HMRC's radar. Combined with upcoming reporting requirements that will give HMRC greater visibility of crypto transactions, now may be the time to review your position if you have previously traded, invested in, or otherwise received cryptoassets.

HMRC’s visibility of crypto is increasing

The publication of these statistics comes as the UK implements the Crypto-Asset Reporting Framework (CARF), an international reporting standard designed to give tax authorities greater visibility over cryptoasset activity. Under the new rules, cryptoasset service providers will be required to collect and report information about their users and transactions to tax authorities.

From 2027, HMRC will begin receiving significantly more information from cryptoasset service providers about UK-resident users and their activity. This represents a major increase in the data available to HMRC and is likely to make it easier for the tax authority to identify individuals whose crypto transactions may not have been reported correctly.

For those with historical undeclared income or gains, this creates an important opportunity to review and address any potential tax liabilities before HMRC makes contact.

Could you have a reporting obligation?

Many people assume tax on crypto assets only becomes relevant when cryptocurrency is converted into pounds. However, in reality, the rules are often more complex.

Taxable disposals can arise when cryptoassets are sold for cash, exchanged for another cryptoasset, or used to purchase goods or services. Depending on the circumstances, Income Tax considerations can also arise from activities such as mining, staking, lending, and receiving cryptoassets through employment or self-employment.

As a result, some individuals may have tax reporting obligations without realising it. In this article, we explore some of the common circumstances that can lead to undeclared crypto income or gains.

Why do people get crypto tax wrong?

Cryptoasset taxation can become particularly complicated where there have been hundreds or thousands of transactions across multiple exchanges and wallets. The position can be even more difficult where records are incomplete, accounts have been closed, or historic transaction data is not readily available.

In many cases, individuals are not deliberately avoiding tax. They may simply be unaware that certain transactions trigger a tax liability or have struggled to calculate their position accurately.

If you have made gains from cryptoassets and are unsure whether they were reported correctly for tax purposes, it is worth reviewing your position.

Making a voluntary disclosure to HMRC

If crypto-related income or gains have not been reported, or have been reported incorrectly, making a voluntary disclosure can provide a route to putting matters right.

This typically involves identifying the affected tax years, reviewing or sometimes reconstructing historic transactions, calculating any tax due, and assessing the associated interest and penalties. As such, specialist advice can be particularly valuable in determining the correct tax treatment and ensuring any disclosure is complete and accurate.

Importantly, you do not need to wait for HMRC to identify an issue. In fact, taking the initiative to disclose historical liabilities can put you in a much stronger position than simply waiting for HMRC to make contact.

Don’t wait for HMRC to find you

Taxpayers who wait for HMRC to contact them can face significantly higher penalties. In the most serious cases, individuals may also face allegations of fraud and potential criminal investigation.

If you have previously traded, invested in, or received cryptoassets and are concerned that you may have undeclared tax liabilities, now is the time to take advice.

How we can help

Our Tax Disputes and Investigations team can help individuals establish whether tax is due, reconstruct historical crypto transactions, calculate outstanding liabilities, and, where appropriate, make a voluntary disclosure to HMRC.

As well as reducing penalties, getting advice before HMRC makes contact can give you greater control over the process, and help ensure that any disclosure is accurate, complete, and appropriately presented.

If you are concerned about historic undeclared crypto income or gains, contact our tax team for a confidential discussion about your position. The sooner you address the issue, the more options you are likely to have.