Which Taxes Apply?
Anyone who trades (buys/sells) or mines cryptoassets, or uses cryptoasset derivatives, needs to first consider if they are engaged in financial trading in cryptoassets (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 professional tax advisor to consider your specific circumstances.
Assuming the cryptoasset activity is not treated as a financial trade, 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
โ€‹
๐Ÿ’ท
Selling Crypto for Fiatโ€‹โ€‹โ€‹
โœ…โ€‹โ€‹
โŒ
๐Ÿ”„ Trading Crypto to Cryptoโ€‹
โœ…โ€‹โ€‹
โŒ
โ€‹
๐Ÿ›
Purchases using Cryptoโ€‹
โœ…โ€‹โ€‹
โŒ
โ€‹
๐ŸŽ
Giftsโ€‹โ€‹
โœ…โ€‹โ€‹
โŒ
โ€‹
๐Ÿ’
Spouse Transfersโ€‹
โŒ (if conditions met)
โŒ
โŒ (if conditions met)
โŒ
โ€‹๐ŸŽˆ Airdropsโ€‹โ€‹
โŒ*โ€‹
โœ… (Sometimes)
๐Ÿค Stakingโ€‹โ€‹โ€‹
โœ…โ€‹โ€‹ (if beneficial ownership is transferred)
โœ…
โ€‹
๐Ÿ’ธ
Transfersโ€‹โ€‹
โŒโ€‹โ€‹
โŒ
โ€‹
๐Ÿด
Forksโ€‹โ€‹โ€‹
โŒ^
โŒ
โ€‹
โ›
Miningโ€‹โ€‹โ€‹
โŒ*
โœ…
โ€‹
๐Ÿ‘›
โ€‹โ€‹โ€‹โ€‹โ€‹โ€‹ Employment incomeโ€‹
โ€‹โ€‹โŒ*โ€‹
โœ…
โ€‹
๐Ÿšจ
Lost & Stolen Cryptoโ€‹
Potential to claim capital lossesโ€‹
โŒ
โ€‹
๐ŸŽฒ
Gamblingโ€‹
โ€‹โ€‹โœ…โ€‹โ€‹
โŒ
โ€‹
๐Ÿ’ง
โ€‹โ€‹โ€‹โ€‹โ€‹โ€‹โ€‹โ€‹Liquidity Pool Rewardsโ€‹โ€‹
โ€‹โŒ*
โœ…
โ€‹
๐Ÿ’ง
โ€‹Liquidity Pool Entry/Exitโ€‹
โ€‹โ€‹โœ…โ€‹โ€‹ (if beneficial ownership is transferred)
โŒ
โ€‹
โฌ†
Token Upgrades/Swapsโ€‹โ€‹โ€‹
โŒ^
โŒ
โ€‹
๐Ÿ”ฎ
Cryptoasset derivatives (CFDs, Futures and Margin Trading)โ€‹โ€‹โ€‹
โœ…โ€‹โ€‹โ€‹โ€‹โ€‹โ€‹ (Individual discretion)
โœ… (Individual discretionโ€‹)
โ€‹
๐Ÿ’ผ
Crypto Loan Principalโ€‹โ€‹โ€‹
โœ…โ€‹โ€‹ (if beneficial ownership is transferred)
โ€‹โ€‹โŒ
โ€‹
๐Ÿ’ผ
Providing Collateralโ€‹
โœ…โ€‹โ€‹ (if beneficial ownership is transferred)
โŒ
โ€‹
๐Ÿ”„
REPOSโ€‹
โ€‹โ€‹ (if beneficial ownership is transferred)
โŒ
โŒ*
โœ…
โ€‹
๐Ÿชž
Reflections Rewardsโ€‹โ€‹
โŒ*โ€‹
โŒ
โ€‹
๐Ÿ‘ฅ
Referral Incomeโ€‹โ€‹โ€‹
โŒ*
โœ…
โ€‹
๐Ÿ’ณ
Cashbackโ€‹
โŒ*
โŒ
โ€‹โ€‹โ€‹โ€‹โ€‹โ€‹
๐ŸŽจ
NFTs (Non Fungible Tokens)โ€‹
โœ…
โŒ
โ€‹
๐ŸŽฎ
NFTs earned playing gamesโ€‹โ€‹
โŒ*โ€‹โ€‹
โœ…
* 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.
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