There are new rules for cyrptocurrency investors as they must declare investments to HMRC. HMRC is set to receive automated account data from cryptocurrency exchanges to ensure traders are paying the correct amount of tax.
This initiative targets unpaid Capital Gains Tax on crypto profits as the government tightens its grip on the rapidly expanding digital asset market. By collecting data directly from these platforms, HMRC aims to bring crypto oversight in line with traditional banking standards.
Labour Party Chancellor of the Exchequer Rachel Reeves said: “Bringing crypto into the regulatory perimeter is a crucial step in securing the UK’s position as a world leading financial centre in the digital age.
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“By giving firms clear rules of the road, we are providing the certainty they need to invest, innovate and create high skilled jobs here in the UK, while giving millions strong consumer protections, and locking dodgy actors out of the UK market.”
The UK government is ramping up crypto oversight by requiring exchanges to share user data directly with HMRC. The move aims to eliminate tax evasion on digital asset profits, specifically targeting Capital Gains Tax.
As the industry grows, ministers are treated these “digital banks” with the same level of scrutiny as traditional financial institutions.
Many people believe you only owe tax when you “cash out” to GBP. However, HMRC views swapping (e.g., trading Bitcoin for Ethereum) as a “disposal,” and you may owe Capital Gains Tax on any profit made since you originally bought the first asset.
The new framework (CARF) specifically includes NFTs, stablecoins, and certain DeFi (Decentralized Finance) tokens. If the platform facilitates the trade, they are likely required to report it.
HMRC currently offers a Digital Disclosure Service. It is generally much better to voluntarily “come clean” about past years before this automatic data sharing starts in 2026, as penalties for voluntary disclosure are typically lower than those for discovered evasion.
