81,000 warning letters sent to crypto holders in HMRC tax crackdown
According to a Freedom of Information (FOI) request the number of letters sent has almost tripled since 2024.
In the past year, HM Revenue and Customs (HMRC) issued over 81,000 warning letters to individuals holding cryptocurrency, indicating they might be liable for capital gains tax.
According to a Freedom of Information (FOI) request reviewed by the BBC, the volume of these letters from the tax authority has nearly tripled since 2024. Investors who fail to declare profits from selling cryptocurrency, even if they exchange one digital currency for another, could face penalties or legal action.
New powers slated for HMRC next year are expected to simplify the process of targeting affluent crypto investors. One analyst remarked that investigations would become as straightforward as "shooting fish in a barrel."
Neela Chauhan, a partner at UHY Hacker Young, the firm that conducted the FOI, stated, "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."
During the 2025-26 financial year, HMRC dispatched 81,172 warning communications, including letters, emails, and text messages, to crypto investors suspected of underpaying tax. This figure represents a significant increase from the 27,714 sent in 2023-24.
An HMRC spokesperson commented, "We’re committed to helping people pay the right amount of tax, and the vast majority do. We regularly send letters to educate, remind or prompt customers to review their tax affairs, including customers who use crypto assets."
Despite a recent decline in the value of cryptocurrencies like Bitcoin and Ethereum, HMRC suspects a substantial amount of unpaid capital gains tax from the surge in cryptocurrency values between December 2022 and October 2025. During this period, Bitcoin's price escalated from approximately £14,000 to £90,000.
Accountants are advising investors to verify their tax obligations, as forthcoming powers will enable HMRC to more easily target individuals. Starting in March 2027, cryptocurrency platforms in numerous countries outside the UK will be mandated to share customer information with tax authorities.
When these rules were announced last year, HMRC stated that the new powers would compel "crypto bros to pay their fair share of tax." The tax office projected that these changes would generate up to £315 million by April 2030, an amount equivalent to funding over 10,000 newly qualified nurses for a year.
Ms. Chauhan cautioned, "Once HMRC has this data, tax investigations into cryptocurrency investors will be like shooting fish in a barrel." In the last year, the price of Bitcoin has dropped to around £48,000.