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HM Revenue and Customs (HMRC) has issued over 81,000 notices in the past financial year to individuals holding cryptocurrencies, warning them they might owe capital gains tax. According to a Freedom of Information request obtained by the BBC, the volume of these communications has nearly tripled compared to figures from 2024. Investors are reminded that failing to report profits realized from selling or even exchanging cryptocurrencies could lead to penalties or legal action.
Looking ahead, HMRC is expected to receive expanded authority in 2027, enabling the agency to more effectively identify and pursue high-value cryptocurrency investors. Neela Chauhan, a partner at UHY Hacker Young who was involved in the FOI request, described the situation: “There is the expectation amongst tax authorities that cryptocurrency investment is rife with tax evasion.” She added, “A lot of the traders are young, have had little previous exposure to HMRC and often work under the assumption that HMRC has limited visibility over their activities.”
In the 2025-26 financial year alone, HMRC dispatched 81,172 warnings—via letters, emails, and texts—targeting crypto investors suspected of underpaying taxes. This number represents a significant increase from the 27,714 notices sent the previous year. An HMRC spokesperson emphasized the authority’s commitment to helping the public fulfill their tax responsibilities, stating, “We regularly send letters to educate, remind or prompt customers to review their tax affairs, including customers who use crypto assets.”
Despite a recent drop in the value of major cryptocurrencies like Bitcoin and Ethereum, HMRC believes substantial unpaid capital gains tax still exists, especially considering the dramatic price surge between December 2022 and October 2025, when Bitcoin’s value climbed from approximately £14,000 to £90,000. From March 2027, new legislation will require foreign cryptocurrency platforms serving UK customers to share user data with HMRC. The tax office anticipates these measures could generate up to £315 million by April 2030, an amount equivalent to funding over 10,000 newly qualified nurses for one year. As Ms. Chauhan warned, “Once HMRC has this data, tax investigations into cryptocurrency investors will be like shooting fish in a barrel.” In the past year alone, Bitcoin’s price has decreased to around £48,000
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