Capital Gains Tax on Crypto

HMRC treats most individual investors’ crypto activity as capital (not a trade). A taxable disposal happens when you:

• sell for GBP (or any fiat),
• swap one token for another (including stablecoins/NFTs),
• spend crypto on goods/services, or
• gift it (except to a spouse/civil partner).

You’ll only pay CGT if your net gains for the tax year exceed the £3,000 annual exempt amount, but you may still need to report depending on your total proceeds and filing status.

Income vs capital

Some crypto receipts are income instead of capital, for example, certain mining, staking or airdrop rewards (especially where you did something to earn them). Those are generally taxed as trading or miscellaneous income at your normal income-tax rates. Later disposals of those tokens can then create capital gains/losses. HMRC’s Cryptoassets and Self Assessment guidance covers the distinctions.

• CGT rates on crypto (other assets): 18% within the basic-rate band; 24% for gains falling in higher/additional-rate bands. HMRC’s 2024–25 SA108 notes confirm these rates apply to disposals on/after 30 Oct 2024 (earlier disposals were 10%/20%).
• Annual exempt amount: £3,000 for 2024–25 and 2025–26.

You’ll work out how much of your gains sit in each band after adding gains to your taxable income for the year.

HMRC applies the share-matching rules to fungible tokens of the same type (e.g., all your BTC are one “pool”). When you dispose of some BTC you must match them in this order:

1. tokens acquired the same day,
2. tokens acquired within the following 30 days (“bed & breakfast”),
3. everything else in your Section 104 pool at average cost.

You calculate each disposal in GBP at the date/time of the transaction. Include directly related transaction fees in your cost/proceeds.

HMRC expects detailed records for each crypto transaction, including:

• asset type and quantity,
• dates and times,
• GBP value on each acquisition/disposal,
• wallet/exchange addresses and transaction IDs,
• fees, and your running pooled average cost for each token.

Because exchanges may not retain full history, download statements regularly and store backups.

With Ftax Individual Self Assessment (SA100) you can add SA108 Capital Gains Summary, including the new Cryptoassets section introduced for 2024/25 returns. Enter your totals (and any carried-forward losses), let Ftax run checks, then submit to HMRC from within Ftax and receive an HMRC receipt. If you have both capital gains and crypto income (e.g., staking), include the relevant income pages too.

• Forgetting swaps are disposals. Token-to-token trades are taxable disposals even if no GBP is involved. Track the GBP value on the trade date.
• Ignoring the 30-day rule. Selling and rebuying a token within 30 days changes which cost lots you use — it can increase your gain if prices rise.
• Not converting to GBP at the right time. Always convert each leg (buy and sell) at its own date/time — don’t convert a net figure.
• Missing the SA108 Cryptoassets section (2024/25+). HMRC now calls it out specifically in the notes; include it when relevant.
• Poor record-keeping. If HMRC asks, you’ll need to show how every figure was derived. Keep exports and your Section 104 pool workings.

DeFi tax treatment depends on the nature of the transaction. Some events look like disposals (CGT), others like income (taxed as such). HMRC maintains and updates guidance; if you’re using complex protocols or have large values, consider getting advice and keep thorough documentation for each step.