The UK’s HMRC treats crypto as property (like stocks). Every disposal is a taxable event. The UK has the most detailed and accessible crypto tax guidance of any major economy.
What Is Taxable in the UK
| Event | Taxable? | Type |
|---|---|---|
| Sell crypto for GBP | Yes | Capital gain/loss |
| Trade one crypto for another | Yes | Capital gain/loss |
| Spend crypto on goods/services | Yes | Capital gain/loss |
| Gift crypto to spouse | No | Transfers between spouses are tax-free |
| Gift crypto to others | Sometimes | May be income tax (if from business) or CGT |
| Receive mining rewards | Yes | Income tax (at receipt value) |
| Receive staking rewards | Yes | Income tax (at receipt value) |
| Receive airdrops | Usually | Income tax if from employment/marketing |
| Donate to charity | No | No CGT, may claim income tax relief |
Tax Rates
Capital Gains Tax
| Tax Band | Rate |
|---|---|
| Basic rate (£12,571-£50,270) | 10% on crypto gains |
| Higher rate (over £50,270) | 20% on crypto gains |
| Annual exemption | £3,000 (below this = no CGT) |
Income Tax
| Tax Band | Rate |
|---|---|
| Personal allowance (up to £12,570) | 0% |
| Basic rate (£12,571-£50,270) | 20% |
| Higher rate (£50,271-£125,140) | 40% |
| Additional rate (over £125,140) | 45% |
Key UK Crypto Tax Rules
Same-Day Rule
If you sell crypto and buy the same crypto back within 30 days, HMRC treats it as if the sale didn’t happen (bed and breakfasting rule).
Section 104 Pool
All holdings of the same crypto are pooled together into a single “Section 104 pool” for cost-basis calculation. This means you can’t pick which coins you’re selling.
Allowable Costs
You can deduct:
- Purchase price
- Transaction fees (exchange fees, network fees)
- Mining equipment costs (if mining as a business)
Record-Keeping Requirements
HMRC requires:
- Date of each transaction
- Value in GBP at time of transaction
- Purpose of the transaction
- Counterparty details (exchange, wallet)
- Evidence of cost basis
How to File
- Self-assessment tax return — Must be filed if crypto gains exceed £3,000 or total crypto disposals exceed £50,000
- Use crypto tax software — Koinly, CoinTracker, Recap all support UK rules
- Report in the “Capital Gains” section — Crypto goes under “Other property, assets and gains”
- Deadline — January 31 following the tax year (April 6 - April 5)
Verdict
The UK has one of the most clearly defined crypto tax regimes in the world. The annual £3,000 CGT exemption means small investors may pay no tax. Higher earners pay 10-20% on gains. Use crypto tax software to calculate your gains accurately.
Related: Crypto Tax Guide for Beginners | Crypto Tax Calculator Guide | How Tax Authorities Track Crypto