How Does HMRC Tax Cryptocurrency?
HMRC treats cryptocurrency as a capital asset. When you dispose of crypto — by selling, trading, or gifting — you may trigger a Capital Gains Tax (CGT) liability.
The Annual CGT Allowance
For the 2024-25 tax year, the CGT annual exempt amount is £3,000. Gains below this threshold are tax-free.
UK Crypto CGT Rates
- Basic rate taxpayers (income up to £50,270): 18% on crypto gains
- Higher rate taxpayers (income over £50,270): 24% on crypto gains
Same-Day and Bed and Breakfasting Rules
HMRC uses the share pooling method to calculate cost basis. Same-day acquisitions and those within 30 days of disposal are matched first.