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Recap HomeCrypto Tax Guide (Lite)HMRC Cryptoassets Manual
  • A Technical Guide to Cryptocurrency Tax for UK Individuals
    • What are Cryptoassets?
    • Who are Recap?
  • CRYPTOCURRENCY TAX
    • Do I Need to Pay Tax on my Cryptoassets?
    • Which Taxes Apply?
      • Capital Gains Tax (CGT)
      • Income tax
      • VAT
      • Inheritance tax
      • Stamp Duty
    • How Much Tax Will I Pay?
    • New HMRC DeFi Guidance
      • Overview of HMRC guidance
      • 1️⃣Is the Reward Income or Capital?
      • 2️⃣Is Beneficial Ownership (BO) transferred?
      • 3️⃣Consider the Tax Treatment
        • Staker/Lender/Collateral Provider
          • Income Rewards
            • BO transferred
              • ➡️At Point of Entry
              • ⬅️At Point of Exit
              • 💧On Liquidation
              • 💎On Receipt of Income Reward
              • Example 1A
              • Example 2A
            • BO not transferred
              • ➡️At Point of Entry
              • ⬅️At Point of Exit
              • 💧On Liquidation
              • 💎On Receipt of Income Reward
              • Example 1B
              • Example 2B
          • Capital Rewards
            • BO transferred
              • ➡️At Point of Entry
              • ⬅️At Point of Exit
              • 💧On Liquidation
              • 💎On Receipt of Capital Reward
              • Example 1C
              • Example 2C
            • BO not transferred
              • ➡️At Point of Entry
              • ⬅️At Point of Exit
              • 💧On Liquidation
              • 💎On Receipt of Capital Reward
              • Example 1D
              • Example 2D
        • Borrower
    • Investor or Trader?
      • Badges of Trade Limitations
      • HMRC Approach
      • Court Cases involving Financial Traders
    • Capital Gains Tax
      • Calculating the Capital Gains Position
      • Disposal proceeds
      • Disposals to Connected Parties
      • Allowable costs for CGT
        • Exchange fees
        • Forks - affect on allowable costs
      • Capital Loss Claims
    • Income Tax
      • Financial trading income
      • Miscellaneous Income
      • Employment income
    • Fair Market Valuation
  • TRANSACTION TYPES
    • 💷Selling Crypto for Fiat
    • 🔄Trading Crypto to Crypto
    • 🛍️Purchases using Crypto
    • 🎁Gifts
    • 💍Spouse Transfers
    • 🎗️Gifts to Charity, CASCs & Bodies for a National Purpose
    • 🎈Airdrops
    • 🤝Staking
    • 💸Transfers
    • 🍴Forks
    • ⛏️Mining
    • 👛Employment income
      • UK Employer
      • Overseas employer
      • National Minimum Wage (NMW)
    • 🚨Lost & Stolen Crypto
    • 🎲Gambling
    • 💧Liquidity Pools
      • Example - Liquidity pool
    • ⬆️Token Upgrades/Swaps
    • 🔮Cryptoasset derivatives (CFDs, Futures and Margin Trading)
    • 💼Crypto Loans
    • 🔄REPOS
    • 🪞Reflections Rewards
    • 👥Referral Income
    • 💳Cashback
    • 🎨NFTs (Non Fungible Tokens)
    • 🎮NFTs earned playing games
  • Record Keeping
  • Filing Your Self-Assessment
    • How to Register for Self-Assessment
    • How to Fill In the Tax Return
    • Submitting the Tax Return and Paying the Tax
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  1. CRYPTOCURRENCY TAX

Which Taxes Apply?

PreviousDo I Need to Pay Tax on my Cryptoassets?NextCapital Gains Tax (CGT)

Last updated 8 months ago

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Anyone who trades (buys/sells) or mines cryptoassets, or uses , needs to first consider if they are engaged in(ie a business activity), rather than simply assuming they are classed as an investor and taxed under the capital gains tax regime/miscellaneous income regime.

HMRC state: "Only in exceptional circumstances would they expect individuals to buy and sell exchange tokens with such frequency, level of organisation and sophistication that the activities amount to a trade in itself."

Whether or not there is financial trading in cryptoassets is a complex area. We recommend you read our detailed guidance and consult a to consider your specific circumstances.

Assuming the cryptoasset activity is not treated as a , here is an overview of the most common tax treatment for different types of crypto activity. Click the activity type for more detailed information.

Disposal/Activity Type
Capital Gains Tax
Income Tax

✅​​

❌

✅​​

❌

✅​​

❌

✅​​

❌

❌ (if conditions met)

❌

❌ (if conditions met)

❌

❌*​

✅ (Sometimes)

✅

❌​​

❌

❌^

❌

❌*

✅

​​❌*​

✅

Potential to claim capital losses​

❌

​​✅​​

❌

​❌*

✅

❌

❌^

❌

✅​​​​​​ (Individual discretion)

✅ (Individual discretion​)

​​❌

❌

❌

❌*

✅

❌*​

❌

❌*

✅

❌*

❌

✅

❌

❌*​​

✅

* No Capital Gains Tax at the time of acquisition, but it is subject to capital gains tax when the cryptoasset is later disposed.

^ may affect Capital Gains Tax base cost, though.

​

🔄

​​

​🎈 ​​

🤝 ​​​

✅​​ (if is transferred)

​​

​​​

​​​

​​​​​​

​

​​​​​​​​​​

​​✅​​ (if is transferred)

​​​

​​​

✅​​ (if is transferred)

✅​​ (if is transferred)

​​ (if is transferred)

​​

​​​

​​​​​​

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cryptoasset derivatives
financial trading in cryptoassets
professional tax advisor
Investor or Trader?
financial trade
💷
Selling Crypto for Fiat​​
Trading Crypto to Crypto
🛍️
Purchases using Crypto
🎁
Gifts
💍
Spouse Transfers
🎗️
Gifts to Charity, CASCs & Bodies for a National Purpose
Airdrops
Staking
beneficial ownership
💸
Transfers
🍴
Forks
⛏️
Mining
👛
Employment income
🚨
Lost & Stolen Crypto
🎲
Gambling
beneficial ownership
⬆️
Token Upgrades/Swaps
🔮
Cryptoasset derivatives (CFDs, Futures and Margin Trading)
💼
Crypto Loan Principal​​
beneficial ownership
💼
Providing Collateral
beneficial ownership
🔄
REPOS
beneficial ownership
🪞
Reflections Rewards
👥
Referral Income
💳
Cashback
🎨
NFTs (Non Fungible Tokens)
🎮
NFTs earned playing games
💧
💧
💎
Liquidity Pool Rewards
Liquidity Pool Entry/Exit
​​ Lending Rewards​​​