HM Revenue and Customs recorded 240 UK taxpayers reporting more than £1 million ($1.36 million) each in crypto capital gains for the 2024-25 tax year, as the authority prepares to receive far more detailed information on UK crypto users through international reporting rules beginning in 2027.
Official HMRC figures show that 17,600 people declared taxable gains from cryptoassets during the year. Their combined disposal proceeds reached £13.8 billion ($18.76 billion), while total reported gains came to £1.38 billion ($1.87 billion).
The small group declaring gains above £1 million accounted for £717 million ($974 million), or just over half of all crypto gains reported in the data. That concentration illustrates how a relatively limited number of large disposals drove much of the tax base, despite crypto ownership being spread across a far larger population.
The 2024-25 return was the first Self Assessment form to include a dedicated section for cryptoasset capital gains. Previously, taxpayers reported these transactions within the wider capital gains area, making it harder to isolate crypto activity in official tax data.
HMRC put the average reported gain at about £78,000 ($106,000) per person. The figure reflects gains rather than the full value of sales: capital gains tax applies to the profit made on a disposal after allowable costs and losses are taken into account.
Dedicated reporting brings crypto gains into clearer view
The new Self Assessment section covers taxable disposals of cryptoassets such as Bitcoin, Ether and Dogecoin, according to HMRC. A disposal can occur when someone sells tokens for pounds, exchanges one cryptoasset for another, uses tokens to buy goods or services, or makes certain gifts.
That treatment often catches out people who regard a token-to-token trade as a transaction that remains entirely within the crypto market. Under UK tax rules, swapping Bitcoin for Ether can create a taxable capital gain or loss even where no pounds enter the transaction.
The £3,000 annual capital gains tax allowance also places more smaller crypto transactions within reporting range than in previous years. Taxpayers with crypto gains or income above the applicable tax-free allowance for 2025-26 must include the activity in their Self Assessment return, with tax due by Jan. 31, 2027.
HMRC’s figures do not show which cryptoassets produced the gains or whether they came primarily from long-term holdings, trading activity, decentralised finance transactions, or payments. The reported £13.8 billion in proceeds nevertheless points to a substantial volume of taxable disposals passing through the UK tax system during the period.
Warning letters have increased
The tax data arrives alongside a sharp increase in HMRC’s outreach to people suspected of failing to report crypto-related tax liabilities.
Accountancy firm UHY Hacker Young said HMRC sent 81,000 warning letters to people it believed may have underpaid tax on crypto activity, a 25% increase from 65,000 a year earlier. The firm described the communications as “nudge” letters, which encourage recipients to review their tax position and make a disclosure before HMRC opens a formal inquiry.
UHY Hacker Young separately said HMRC sent 27,714 such letters in 2023-24. The letters are part of the authority’s effort to move taxpayers into voluntary compliance before it relies on more extensive third-party reporting data.
A recipient does not necessarily owe additional tax merely because they receive a letter. Crypto users may have already reported gains, made losses, remained below the annual exemption, or held assets without disposing of them. Yet the letters create a practical need to reconstruct records, particularly for people who used several platforms, moved assets between wallets, or traded frequently across different tokens.
Tax penalties depend on the circumstances of an error, including whether a taxpayer took reasonable care and whether they make an unprompted or prompted disclosure. Interest can also accrue on late-paid tax.
International data sharing starts in 2027
The UK began implementing the Organisation for Economic Co-operation and Development’s Cryptoasset Reporting Framework in January 2026. Under the framework, cryptoasset service providers will collect customer and transaction information and report it to their domestic tax authorities, which can then exchange relevant information with other participating jurisdictions.
HMRC has said it expects to begin receiving data from cryptoasset service providers in 2027. The information is intended to help identify UK residents who may have undisclosed crypto gains or income.
UHY Hacker Young said HMRC is expected to automatically receive information on UK residents from crypto exchanges and other providers in 52 jurisdictions from May 31, 2027. A further 15 jurisdictions are expected to begin sharing data in 2028.
The reporting regime would reduce the ability of UK residents to rely on an overseas platform as a barrier to tax enforcement. It also gives HMRC a means to compare information reported by platforms with Self Assessment returns, rather than depending mainly on voluntary declarations and information gathered during individual compliance work.
For taxpayers, the immediate issue is record quality. Calculating gains requires dates, acquisition costs, disposal values, fees, token quantities and, in many cases, records of transfers between personal wallets and trading platforms. The task can become more complicated where assets were acquired during earlier market cycles and later exchanged repeatedly.
The 2024-25 figures offer the first clean official snapshot of crypto capital gains reported through a dedicated return field. With international reporting set to feed more customer data to HMRC from 2027, the next phase of UK crypto taxation is likely to focus less on identifying possible activity and more on matching platform records against the gains taxpayers declare.
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