Quick answer
In the UK, crypto assets are generally subject to capital gains tax when you sell, swap or spend them, and income tax on rewards from staking, mining or airdrops. Report disposals above the allowance, or proceeds above £50,000, on your Self Assessment return.
Updated October 2026 · Figures based on 2025/26 rates
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Capital gains on disposals
Selling, swapping one token for another, spending crypto and gifting it to someone other than a spouse can all be disposals. The annual exempt amount is £3,000 for 2025/26, and rates are 18% or 24%.
Income tax on rewards
Staking rewards, mining income and some airdrops are taxed as income at their market value when received, sometimes with later capital gains too.
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Pooling rules
Same-day and 30-day rules apply before the section 104 pool, so calculating gains needs careful records of each transaction.
Records and reporting
Keep dates, amounts, values in pounds and wallet or exchange statements. Report gains and losses on the capital gains pages of your return.
When crypto creates Capital Gains Tax
For most individuals, cryptoassets are treated as capital assets. A disposal can trigger Capital Gains Tax. A disposal is not only selling for pounds. It also includes swapping one token for another, spending crypto on goods or services and giving crypto to someone other than your spouse or civil partner. Simply buying and holding is not a disposal, and moving coins between your own wallets is not either.
The annual exempt amount is £3,000. Gains above that are taxed at 18% where they fall within your remaining basic rate band and 24% above it. Gains and losses are netted off across all your assets in the tax year, and unused losses can be carried forward if reported to HMRC.
How the pooling rules work
For crypto, HMRC expects you to match disposals against acquisitions in a set order. First, anything bought on the same day. Second, anything bought within the following 30 days. Third, the Section 104 pool, which holds all other tokens of the same type at their average cost. This avoids picking and choosing which purchase to sell.
A worked example
This is an illustrative example, not a real investor. Nina buys 2 units of a token over time: one for £5,000 and one for £7,000. Her pool therefore contains 2 units at a total cost of £12,000, which is £6,000 per unit on average. Later she sells one unit for £10,000, and pays £50 in fees.
| Step | Working | Amount |
|---|---|---|
| Proceeds after fees | £10,000 – £50 | £9,950 |
| Pool cost for one unit | £12,000 / 2 | £6,000 |
| Gain | £9,950 – £6,000 | £3,950 |
| Annual exempt amount | (£3,000) | |
| Taxable gain | £950 | |
| CGT at 18% (if within basic band) | £950 x 18% | £171 |
| CGT at 24% (if higher rate) | £950 x 24% | £228 |
The rate depends on Nina’s other taxable income that year. If the gain were instead a loss, she could report it to HMRC and carry it forward against future gains.
When crypto is income instead
Some crypto activity produces income rather than a capital gain. Examples include being paid in crypto for work, certain staking rewards, mining carried on as a trade and some airdrops received for services. Income is taxed under Income Tax rules at its sterling value when received, and may also attract National Insurance if it is a trade. Whether activity counts as a trade, as miscellaneous income or as a capital gain is a question of facts, so check current HMRC guidance or take advice if the activity is more than occasional.
Common mistakes
- Believing that swaps between tokens are tax-free. They are disposals.
- Failing to keep transaction histories from every exchange and wallet.
- Ignoring small disposals. They count towards the total even if each seems minor.
- Using the wrong values: gains must be calculated in pounds at the date of each transaction.
- Forgetting the same-day and 30-day rules when buying back the same token.
A short checklist
- Export transaction records from every exchange and wallet.
- Convert each transaction into pounds on its date.
- Apply same-day, 30-day and pooling rules.
- Separate income items from capital gains.
- Report on your return, including losses you want to carry forward.
Related reading
See the CGT annual exempt amount explained, how to report capital gains to HMRC, how to claim capital losses and capital gains tax on shares. Our capital gains tax return service handles the reporting.
SATR can prepare your crypto disclosure for a fixed fee from £199 + VAT, and qualified UK accountants file it online. For very large transaction volumes, we will confirm the scope with you first.
This is general information, not personal tax advice. Check current HMRC guidance on cryptoassets.
Record keeping for crypto
Good records are the single most important part of reporting crypto correctly. For each transaction you should be able to show the date, the type of asset, the quantity, the sterling value at the time, the fees and the wallet or exchange involved. Exchanges often let you download a history, but those files can be incomplete, particularly if you moved assets between platforms or used decentralised services. Reconcile what you have against your bank records.
Keep records for the same period as other Self Assessment records, which is five years after the 31 January filing deadline, and for assets held in a pool it is sensible to keep the full history of acquisitions for as long as you hold them. Without that history, it is hard to prove the pool cost later. If you have gaps, note how you filled them and the basis for any estimates, and be ready to explain your method if HMRC asks.
If you have missed reporting earlier disposals, it is usually better to put things right voluntarily than to wait. Our guide on how to amend a Self Assessment return explains the time limits for corrections.
Frequently asked questions
Do I need to report if I only hold crypto?
Holding alone is not a taxable event, but disposals during the year may need reporting.
Can crypto losses be used?
Yes. Losses reported to HMRC can offset gains in the same year or be carried forward.
Do I pay tax if I only buy and hold crypto?
No Capital Gains Tax arises until you dispose of it, for example by selling, swapping or spending it.
Can I claim a loss on crypto?
Yes, allowable losses can be set against gains and carried forward if reported to HMRC in time. Loss claims have time limits, so check current guidance.
Does transferring between my own wallets count as a disposal?
No. Moving assets between wallets you own is not a disposal, though you should keep records.
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Conclusion
Crypto disposals — sales, swaps, spending and gifts — trigger Capital Gains Tax above the £3,000 annual exempt amount, with 18% or 24% rates. Staking, mining and airdrops may be income. Keep full transaction records in pounds, apply same-day, 30-day and pooling rules, and report on your Self Assessment return.
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