Prime Accountants warn crypto investors that they need to pay tax on their assets after HMRC crackdown
By Paislei Godley, Director
West Midlands-based Prime Accountants warn cryptocurrency investors that they need to pay tax on their digital assets after HMRC sent 64,982 warning letters about Capital Gains Tax (CGT) in 2025.
Crypto investments are on the up, according to the data. In the 2022-2023 tax year, HMRC issued just under 28,000 crypto tax nudge letters, which is significantly lower than the nearly 65,000 that were sent out in the 2024-2025 tax year.
Paislei Godley is a director at Prime who specialises in tax. She said: “Cryptocurrency tax is often difficult for people to understand. Many people simply aren’t aware that they have to pay tax on the online currency.
“Often, people believe that their crypto falls outside of the realm of tax, whether this is because they don’t think crypto can trigger Income Tax or because they aren’t aware that swaps can trigger tax.”
Cryptocurrency can fall under one of two forms of tax, CGT or Income Tax.
Paislei said: “If you use crypto as a form of income rather than an investment, you are liable to pay Income Tax.
“For crypto to be considered for Income Tax, you will be receiving crypto from mining, earning crypto rewards through staking or receiving crypto as a payment for goods and services.”
If your crypto trading is not a regular source of income for you, then it is more than likely to be classified as CGT.
Paislei said: “CGT applies whenever crypto is disposed of, including when it is sold, exchanged for another cryptocurrency or used to buy goods and services.
“You only pay CGT on net capital gains above the £3,000 tax-free allowance.
“However, if your total crypto sales or proceeds exceed £50,000 in a tax year, you must still report them to HMRC, even if your net gain is below £3,000.”
With the HMRC crackdown on digital assets underway, people must track their investments throughout the year so that they can ensure they are paying the correct amount of tax.
Paislei said: “Managing tax on crypto is difficult, but our team here at Prime are here to support you with your digital assets. Get in touch with us for support.”
