How to Report Crypto Income in the UK: A Complete 2024 Tax Guide

Understanding Crypto Tax Obligations in the UK

With cryptocurrency adoption soaring, HMRC has tightened regulations around digital asset reporting. If you’ve earned crypto income through trading, staking, or other activities in the UK, you must declare it or risk penalties. This guide breaks down exactly how to report crypto income to stay compliant with UK tax laws.

Types of Crypto Income and Tax Treatment

Not all crypto activities are taxed equally. HMRC categorizes them into:

• Trading Profits – Subject to Capital Gains Tax (CGT) when selling for profit. Annual exemption: £6,000 (2023/24).
• Staking/Mining Rewards – Treated as miscellaneous income, taxed at income tax rates (20%-45%).
• Airdrops & Forks – Taxable as income at market value when received.
• Crypto as Payment – Income tax applies based on GBP value when received.
• DeFi Lending – Interest is taxable as miscellaneous income.

Step-by-Step Reporting Process

1. Calculate Gains/Income: Use crypto tax software or spreadsheets to track acquisitions, disposals, and values in GBP.
2. Complete SA100 Form: File via HMRC’s Self Assessment portal by January 31 following the tax year.
3. Report Capital Gains: Use supplementary form SA108 for crypto disposals.
4. Declare Miscellaneous Income: Include staking/mining rewards in the ‘Other Income’ section (box 17).
5. Pay Taxes Owed: Settle liabilities by January 31 deadline to avoid interest charges.

Critical Record-Keeping Requirements

HMRC requires detailed records for 5+ years after submission:

• Transaction dates and GBP values
• Wallet addresses and exchange records
• Proof of cost basis for acquired assets
• Calculations for pooled assets (using same-day, 30-day, or Section 104 rules)

Common Crypto Tax Mistakes to Avoid

• Ignoring small transactions – all disposals must be reported
• Forgetting airdrops or NFT income
• Miscalculating pooled costs
• Missing the January 31 deadline (£100 immediate penalty)
• Not reporting foreign exchange holdings

FAQs: Reporting Crypto to HMRC

Do I need to report if I made losses?

Yes. Reporting losses allows you to carry them forward to offset future gains.

How is crypto-to-crypto trading taxed?

Each trade is a taxable event. You must calculate GBP gain/loss when disposing of one crypto for another.

What if I use multiple exchanges?

Consolidate all transaction histories. HMRC requires full disclosure across all platforms.

Are there penalties for late reporting?

Yes: Initial £100 fine, then daily penalties after 3 months, plus 5%-100% of tax owed for deliberate non-compliance.

Can I use tax software?

Absolutely. Tools like Koinly or CoinTracker automate calculations and generate HMRC-compliant reports.

Is there a tax-free threshold?

Only for CGT (£6,000 in 2023/24). Income from staking/mining has no allowance.

Staying Compliant in 2024

HMRC now uses blockchain analytics to identify crypto holders. Proactive reporting with accurate records is essential. Consult a crypto-specialist accountant if dealing with complex DeFi transactions or high-value portfolios. Remember: Crypto isn’t anonymous – it’s pseudonymous. With proper planning and timely filing, you can navigate UK crypto taxes confidently.