Proper planning can be a key factor in avoiding missed deadlines and the potential for financial penalties. It is essential to stay informed and up-to-date with any changes in tax laws and regulations that may affect your finances. A recent example of such a change is the UK chancellor's announcement in the budget, where it was confirmed that starting from the 2024/25 tax year, a separate category will be included on self-assessment tax returns for reporting gains and losses related to crypto assets. This underscores the importance of staying ahead of the game, being proactive in your tax planning, and seeking professional advice to ensure compliance with the latest tax laws and regulations. By taking these steps, you can mitigate the risks and potential consequences of non-compliance, while also maximizing your tax efficiency and financial well-being.

This is a positive step towards raising awareness about the requirement to report crypto gains and losses made by UK investors and traders. It's important to note that while the rules on the taxation of crypto assets have not changed, treating crypto assets as capital assets means that when you dispose of a crypto asset, the transaction will be subject to capital gains tax treatment. This includes selling crypto for fiat, trading crypto for crypto, spending crypto on goods/services, and gifting crypto (unless to your spouse).

The gain or loss is calculated by taking the GBP value of the crypto asset at the date of disposal, less the GBP value of the crypto asset at the date of acquisition. It's worth noting that in the UK, there are capital gains tax-free allowances of GBP 12,300 for the 2022/23 tax year. This means that you can realize gains of up to GBP 12,300 without paying capital gains tax.

However, if this allowance is not used within the tax year, it does not carry forward, and as such, you will lose it. It's also essential to keep in mind that the capital gains tax-free allowance will be reduced to GBP 6,000 for the 2023/24 tax year and to GBP 3,000 for the 2024/25 tax year and beyond.

When dealing with crypto assets, it is critical to keep in mind the specific rules governing the buying and selling of the same asset on the same day and within a 30-day period. Selling an asset purely to realize a gain and then repurchasing it within 30 days is not permissible. Additionally, if your total capital gains for the year exceed the capital gains tax-free allowance, you will need to register for self-assessment and report your gains to HMRC. Failing to report gains or attempting to circumvent the rules on the buying and selling of crypto assets could result in significant financial penalties, legal consequences, and damage to your reputation. Seeking professional guidance and keeping accurate records of your crypto asset transactions can help ensure that you comply with the rules and regulations and minimize your risk of facing penalties. By taking a responsible and informed approach to your crypto asset activities, you can safeguard your financial interests and maintain your integrity as a taxpayer.

If your gains are less than the capital gains tax-free allowance, then you don't need to report them to HMRC unless you're already registered for self-assessment, and your total proceeds of assets sold are more than four times the tax-free allowance. Please keep in mind that not all transactions involving crypto assets are subject to capital gain tax treatment, and some may instead be subject to income tax.

Rewards received from mining, airdrops, and staking are likely to be subject to income tax on the GBP value of the assets at receipt. Future gains/losses made on a subsequent disposal of the asset are subject to capital gains tax treatment. It's essential to note that capital gains tax will be due on gains made in excess of the allowance and will be subject to capital gains tax at 10% or 20%, depending on your total income and gains.

Income tax due on relevant crypto asset transactions will be due at 20%, 40%, or 45%, depending on your total income and gains. For more detailed information, we recommend that you review HMRC's guidance on crypto asset taxation. For more detailed information, we recommend that you review HMRC's guidance on crypto asset taxation and you should always seek professional advice from a qualified tax or accounting advisor in respect of your personal tax obligations.

Coinpass Limited ( is registered with the UK Financial Conduct Authority as a crypto-asset firm under the UK's Money Laundering Regulations. Unless legally obliged to, coinpass does not share any of your crypto trading data with the UK HMRC or other government bodies