or reach out to a member of our Private Client team.
Don’t let ignorance cost you: Learn about the recent crypto tax crackdown in the UK and stay ahead of the game by reporting your crypto gains and avoiding penalties, says Tom Andrew…
Tom Andrew Private Client Director at AAB discusses how to stay compliant with Crypto UK Tax Laws.
If you’ve been buying and selling crypto currencies without considering the tax implications, you may be in for a surprise. Recent developments in the UK tax system have led to a crackdown on undeclared crypto gains. The UK government estimates that up to 95% of the crypto community is not complying with tax obligations, highlighting the urgency for individuals to report their profits or losses.
The OECD‘s Crypto-Asset Reporting Framework (CARF), spearheaded by the UK, aims to tackle the billions of unpaid taxes stemming from crypto asset transactions worldwide. Under this new standard, tax authorities will require crypto platforms to share taxpayer information, enabling them to crack down on international tax evasion facilitated by crypto exchanges. Information exchange is set to commence in 2027.
Many crypto traders remain unaware of the requirement to report profits earned from crypto trading. It’s important to note that transactions such as exchanging one form of crypto asset for another can trigger a capital gain. With the complexity and frequency of crypto transactions, it’s advantageous to rely on software platform providers who offer annual tax packs for traders.
If you suspect you have unreported crypto gains, seeking advice from a professional adviser is crucial. Depending on your trading activity, your gains are likely subject to capital gains tax (CGT), not income tax. CGT on crypto gains is taxed at a flat rate of 20% after accounting for the annual CGT exemption (£6,000 in 2022/23 tax year). However, each tax year may have a different CGT exemption, which will apply to your historic gains.
It’s vital to understand the matching rules that determine which sales are linked to specific purchases for gain or loss calculation purposes. Disposals are first matched with assets acquired on the same day, then with assets acquired within the following 30 days, and finally with the average cost of any unmatched assets in the “pool.”
For more information on how to take control of your crypto taxes or for tax planning advice on cryptocurrency investments, please fill in the ‘Call Back’ form on the right of your screen or contact our Tax Team today.
How AAB can help
AAB’s Corporate Tax service supports businesses at every stage by minimising liabilities and simplifying complex tax rules - so you can focus on growth. Their team offers clear, practical advice on extracting profits, group structuring, capital allowances, loss utilisation, and managing capital gains, tailored to suit both day-to-day needs and long‑term ambitions. They’re champions for owner‑managed businesses. AAB advises on the right business structure - sole trader, company, LLP - while creating tax‑efficient strategies for profit withdrawal, succession, and exits. If you’re expanding overseas, AAB's international tax experts guide you through cross‑border structuring. They’ll help you understand global corporation tax regimes, CFC rules, tax residence, withholding taxes, double tax relief, and foreign compliance. In short, AAB cuts through tax confusion. They offer proactive planning and hands‑on support to help reduce your tax bill, streamline compliance, and support your goals at home and abroad - all delivered in a friendly, human-first way.
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Private Client Director
Contact Tom Andrewor reach out to a member of our Private Client team.
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