Cryptocurrency tax is rarely as simple as the exchange’s tax export suggests. We handle CGT and income tax on disposals, mining and staking rewards, DeFi lending and liquidity provision, NFT royalties, HMRC nudge letter responses, historic disclosures, and corporate crypto positions — for individuals, traders and businesses.
Quick answer: most UK individual crypto activity is taxed under Capital Gains Tax (CGT) on disposals at 18% (basic rate) or 24% (higher/additional rate), with the £3,000 annual exemption. Where activity reaches the level of a trade — frequency, organisation, capital and intent — Income Tax applies instead at marginal rates. Mining, staking, airdrops, DeFi lending interest and liquidity provision are typically Income Tax on receipt with CGT on later disposal. Businesses holding crypto sit under Corporation Tax through the loan relationship and intangibles regimes. The categorisation matters because the rate differential is material.
We calculate your CGT position correctly under HMRC’s pooling rules — including the same-day rule, the bed-and-breakfast 30-day rule, and the share-pool basis on remaining holdings — across multiple exchanges, wallets and chains. We don’t accept exchange-supplied “tax exports” at face value; they are usually incomplete (no on-chain wallets, no DeFi events, no inter-exchange transfers reconciled). The calculation goes into your Self Assessment return alongside the rest of your tax position.
Mining rewards, proof-of-stake yield, lending interest and DeFi liquidity provision attract Income Tax on receipt at the GBP value, and CGT on the subsequent disposal of the tokens received. The treatment varies by activity type — a hobbyist solo miner, a commercial mining operation, a staking-only validator, and a DeFi yield farmer all face different positions.
HMRC’s DeFi guidance (updated 2024, further consulted on in 2025) treats most lending and staking arrangements as a beneficial transfer of tokens triggering a CGT disposal at the point of deposit. Liquidity provision is similar with additional complexity around impermanent loss and the dual-token nature of LP positions. The result is often counter-intuitive — substantial unrealised CGT can crystallise simply by depositing into a protocol — and rarely matches what users expect from the underlying economics. We work through the on-chain facts, document the position and prepare the disclosure.
NFT minting, primary sales, secondary royalties and marketplace fees each have distinct UK tax treatment. Creator royalties are typically trading or miscellaneous income; collector flips are CGT; primary mint receipts depend on the nature of the activity. The interaction with VAT (especially for UK-resident creators selling above the £90,000 threshold) needs careful structuring.
HMRC’s ongoing crypto nudge letter campaign asks recipients to confirm whether they have correctly disclosed crypto income and gains. Do not respond without advice — the right route depends on the disclosure history and the materiality. We have responded to multiple nudge letters and can advise on whether direct correspondence, the Worldwide Disclosure Facility (WDF), or the Contractual Disclosure Facility (CDF) is the lower-penalty route.
The Crypto-Asset Reporting Framework comes into effect from January 2026. UK and most major exchanges must now collect tax-residency information and report user activity to HMRC automatically — closing the gap that has historically allowed under-disclosure. For users with historic non-disclosure, the right time to come forward is now, before HMRC opens an enquiry on the back of CARF data.
For businesses, crypto activity falls under the loan relationship rules, the intangible assets regime or the trading rules depending on classification. Common engagements include treasury holdings (Bitcoin, Ether), DAOs structured through UK or offshore entities, businesses accepting crypto as payment, NFT mint and marketplace operators, and crypto-native funds. The interaction with CFC rules and VAT is bespoke per business.
The April 2025 FIG regime applies to crypto income and gains in the same way as other foreign source assets. Pre-arrival planning, election decisions and the four-year window mechanics matter for new UK residents holding meaningful crypto positions. See our international tax service.
The crypto tax service is the right fit for:
UK crypto tax is harder than mainstream commentary suggests for three reasons:
Most generalist UK accountants take a “report what the exchange says” approach. That is increasingly risky as HMRC’s data improves under CARF.
Our four named specialisms — sectors with genuine technical depth and direct industry experience.
Book a Free Discovery Call. Bring your situation — exchange list, position size, DeFi history, any HMRC correspondence — and we’ll outline the right approach and a fixed fee for the work.
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