UK’s tax authority HMRC Cracks Down on Crypto Tax Dodgers with 65K Letters

HM Revenue & Customs (HMRC), the UK government agency responsible for collecting taxes, managing customs, and administering payments, sent nearly 65,000 nudge letters to crypto investors in the 2024–25 tax ￰0￱ more than doubles the 27,700 sent in 2023–24, totaling over 100,000 letters in four ￰1￱ letters urge investors to correct undeclared capital gains from crypto ￰2￱ Data Drives Targeted Probes HMRC gathers transaction data from UK crypto exchanges to identify tax discrepancies. Disposals, including coin swaps, are taxable as capital ￰3￱ 2026, the OECD’s Crypto-Assets Reporting Framework will provide automatic global exchange data, enhancing HMRC’s ￰4￱ Crypto Use Spurs Scrutiny The Financial Conduct Authority estimates seven million UK adults hold crypto, up from five million in ￰5￱ tax rules catch many investors unaware of taxable events like ￰6￱ demands grow as crypto prices ￰7￱ Letters Encourage Compliance Recipients have 60 days to respond or disclose via HMRC’s Cryptoasset Disclosure Facility to avoid ￰8￱ to comply triggers formal investigations, with penalties for late payments on undeclared gains.