HMRC is set to receive details from crypto platforms about UK households’ holdings ahead of a major crackdown. The taxman of the Labour Party government will gain access to individuals and organisations’ cryptoassets.
People will be forced to report crypto gains as part of their annual tax returns following the Autumn Budget. From 1 January 2026, crypto platforms will start recording gains made by UK-based customers.
The details will include how much they paid, how much they sold for and any profits made. Platforms will send that data to HMRC from 2027.
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HMRC will then check that data with self-assessment returns to ensure that returns are truthful. The OECD said: “The ability of individuals to hold Relevant Crypto-Assets in wallets unaffiliated with any service provider and transfer such Relevant Crypto-Assets across jurisdictions, presents the risk that Relevant Crypto-Assets are used for illicit activities or to evade tax obligations.”
The OECD developed the Crypto-Asset Reporting Framework (CARF) which defines Crypto-Assets as “those assets that can be held and transferred in a decentralised manner, without the intervention of traditional financial intermediaries, including stablecoins, derivatives issued in the form of a Crypto-Asset and certain non-fungible tokens (NFTs).”
You may need to pay Capital Gains Tax if you make a gain when you ‘dispose’ of cryptoasset tokens (also known as cryptocurrency) by selling them.
Other examples are exchanging them for a different type of cryptoasset or using them to pay for goods or services or giving them to another person (unless it’s a gift to your spouse, civil partner or charity)
You need to work out your total gains from disposing of certain assets, including cryptoassets.
If your total gain for the tax year (6 April to 5 April) is above the Capital Gains Tax tax-free allowance, then you must report the gain to HMRC.
You must also pay Capital Gains Tax, as per HMRC guidance issued on its website, in a series of factsheets.
The shake-up is particularly pertinent for SMEs and the self-employed, according to tax advisors and crypto experts.
