Crypto▼ Bearish
UK Crypto Tax Crackdown: HMRC Warning Letters Triple to 81,000 in 2025/26
HMRC sent 81,000 crypto tax warning letters in 2025/26, nearly triple the prior year. Neela Chauhan says younger traders underestimate HMRC's reach. New offshore data-sharing powers are expected next year.
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The number of warning letters HM Revenue and Customs sent to crypto holders suspected of unpaid taxes nearly tripled in the 2025/26 financial year, new data show.
HMRC issued more than 81,000 letters in the period, up from 27,714 in 2024, according to figures obtained through a freedom of information request. Officials attribute most of the outstanding liabilities to gains realized during the bull market between 2022 and 2025.
Under UK rules, selling or swapping crypto can trigger a capital gains tax bill. Using digital assets to pay for goods carries the same obligation. Many traders remain unaware that these everyday actions count as taxable events, tax professionals say.
Neela Chauhan, a partner at accounting firm UHY Hacker Young, told the BBC that younger traders often misjudge HMRC's reach. Many, she said, "work under the assumption that HMRC has limited visibility over their activities."
Penalties for unpaid crypto tax can reach 100% of the amount owed, plus interest. That figure rises further for transfers routed through offshore accounts. Chauhan noted that tax authorities suspect widespread underreporting across the trading community.