Got an HMRC Crypto Letter? What It Means and What to Do in 2026

HMRC is contacting UK crypto investors by letter, email and text message in a campaign that runs from July 2026 to March 2027. These messages are not an investigation, but they show that HMRC holds data about your crypto activity. This guide explains what the current letter says, how to check your position year by year, when to amend a return or use the cryptoasset disclosure service, and which penalties, interest and time limits apply.

Checked on 16 October 2026. This guide is for UK-resident individuals. It summarises HMRC guidance, legislation and the published letter template; it is not personal tax advice. The Autumn Budget is scheduled for 28 October 2026 and may change some of the rules described here.

Short answer: what to do when HMRC writes about your crypto

1. Check the message is genuine. HMRC confirms that it contacts crypto traders by letter, email and text. Verify the contact through GOV.UK rather than through links in the message.
2. Do not panic, but do not ignore it. The campaign letters are "one to many" messages. They are not a compliance check, but they mean HMRC has information about you.
3. Rebuild your position for every tax year. List every disposal and every income receipt since you started using crypto, with sterling values and costs.
4. Correct anything missing through the right route. Use the 2025/26 return, an amendment of the 2024/25 return, or HMRC's cryptoasset disclosure service for older years.
5. Keep your workings if everything is correct. The July 2026 letter says you do not need to take further action or contact HMRC in that case. Your calculations are your answer if HMRC asks later.

A nudge letter is not an investigation

HMRC's Compliance Handbook describes the approach behind these letters. According to CH600110, "a One to Many approach is where HMRC sends one standard message to many customers", and its aim is to influence behaviour so that people are more likely to comply. The same page states plainly: "A One to Many approach is not a compliance check."

A formal check looks different. HMRC tells you when it starts one and usually sends factsheets such as CC/FS1a. For a return filed on time, HMRC can generally open an enquiry within 12 months of the day it was delivered under section 9A of the Taxes Management Act 1970. An information notice under Schedule 36 of the Finance Act 2008 is a legal document that requires you to provide information, with a £300 penalty for failure and up to £60 for each further day.

What the July 2026 letter actually says

The current campaign is run by HMRC's Wealthy and Mid-sized Business Compliance team between July 2026 and March 2027, according to ICAEW's report of 23 July 2026. Messages go out by letter, email or text, and agents receive copies of letters sent to their clients. ICAEW also published the letter, titled "Cryptoassets – information to help you understand your tax position".

The letter opens: "We're writing because we have information that suggests you've engaged in cryptoasset activities." It then lists what can create a Capital Gains Tax disposal: selling for money, swapping one cryptoasset for another, paying for goods or services, and giving crypto to anyone other than a spouse or civil partner. It also lists income such as lending, staking and mining rewards, and being paid in crypto.

Three further sentences matter most:

• "If you haven't declared all your income or capital gains, you need to do so."
• "From tax year 2024 to 2025, Self Assessment returns have a dedicated cryptoasset section on form SA108 - boxes 13.1 to 13.8."
• "If you're satisfied your tax affairs are correct you don't need to take any further action or contact us."

If tax is owed and you do nothing, the letter warns that HMRC may work out what it thinks you owe, charge interest and charge a penalty "which could be up to 100% of the additional tax you owe". The July 2026 version contains no response deadline. An earlier template from July 2024 was sharper: it told recipients they had not declared everything correctly and gave a date 60 days ahead. Check the wording and any date on your own letter rather than relying on a generic deadline.

How many people receive HMRC crypto letters

HMRC does not publish these counts itself. The figures below come from Freedom of Information requests by the accountancy firm UHY Hacker Young, reported by the Financial Times and the BBC.

The 2025/26 figure explicitly includes emails and texts; whether the earlier counts did too is not stated, so the trend may not be like for like. HMRC's own statistics, published on 27 August 2026, show the scale of declared activity: 17,600 individuals made Capital Gains Tax-liable crypto disposals in 2024/25, with £1.38 billion of gains. HMRC estimates that its "dedicated upstream work on cryptoassets" generated an additional £168 million of Capital Gains Tax in that year.

Is the letter, email or text genuine?

Scammers copy HMRC branding, so check before you act. HMRC's page on genuine contact that uses more than one communication method has a cryptoassets section. It states: "If you have traded in cryptoassets, HMRC may contact you by letter, email or text message." Texts direct you to guidance on GOV.UK.

• Navigate to GOV.UK yourself instead of following a link in the message.
• Compare the phone number with the one published by HMRC; the campaign letter gives 03000 552294.
• No tax letter requires your private keys, recovery phrase or exchange password. Treat any message asking for them as fraud.

Where HMRC's crypto data comes from

HMRC's Cryptoassets Manual at CRYPTO100300 confirms that it can request information from exchanges under Schedule 23 of the Finance Act 2011 and Schedule 36 of the Finance Act 2008. Such data is one likely source of today's letters.

From 2027 the flow becomes routine. Under the Cryptoasset Reporting Framework, UK platforms have collected user and transaction data since 1 January 2026, and the first reports for calendar year 2026 are due by 31 May 2027. The UK extended the framework to UK-resident customers of UK platforms, so HMRC will receive domestic data as well as information exchanged with other countries. Users must give platforms their name, date of birth, address, country of residence and tax identification number; failing to provide a self-certification can lead to a penalty of up to £300 under regulation 13 of SI 2025/744. The UK CARF guide explains the framework in detail.

Step 1: rebuild your position for each tax year

Start with a complete ledger of every exchange, wallet and DeFi address. For each disposal you need the date, the sterling value received and the allowable cost. UK cost basis follows share-matching rules: same-day acquisitions first, then acquisitions in the following 30 days, then the Section 104 pool. The 30-day rule guide and the overview of UK share-matching rules show how this works.

The allowance and rates depend on the tax year, so older years must be recalculated with the rules that applied then:

Being below the allowance does not always end the matter. If you are registered for Self Assessment, HMRC's guidance requires gains to be reported when total disposal proceeds exceed £50,000 for 2023/24 onwards, even if the gain is covered by the allowance. Income from staking, lending or mining is usually taxed as income rather than as a capital gain, although some DeFi returns can be capital in nature. The HMRC crypto tax guide covers these categories in more depth.

Step 2: choose the right correction route

Which route applies depends on the tax year and whether its return has been filed:

If you were never registered for Self Assessment, the time limit is longer. HMRC's disclosure guidance states that if you did not register by the appropriate deadline, you will have to pay what you owe for up to 20 years, which matches the 20-year assessment limit for a failure to notify under section 36(1A) of the Taxes Management Act 1970.

The cryptoasset disclosure service works in fixed steps:

1. Sign in and gather your details, including your National Insurance number, the exchanges used, the number of transactions, proceeds, costs and gains.
2. Decide how many years to cover. If you took reasonable care, you pay for up to 4 years; if you were careless, up to 6 years; if the underpayment was deliberate, or you never registered for Self Assessment without a reasonable excuse, up to 20 years.
3. Calculate the tax for each year, the interest from each original due date and any penalty, using HMRC's penalty factsheets and calculator.
4. Submit the disclosure online and offer the full amount of tax, interest and penalty.
5. Wait for a payment reference. It has 14 characters and starts with "X". If nothing arrives within 15 working days, call the helpline.
6. Pay within 30 days of submitting the disclosure. HMRC then accepts or rejects the offer in writing and may ask for evidence.

One common error is to quote a 90-day deadline. That belongs to HMRC's general Digital Disclosure Service, where you notify first and disclose later. HMRC's general disclosure guide says crypto disclosures should use the separate cryptoasset service, where the 30-day payment rule applies.

Penalties, interest and time limits

Penalties depend on your behaviour and on whether the disclosure was prompted. Two regimes apply. If you filed a return that left out crypto gains or income, the inaccuracy penalties in HMRC factsheet CC/FS7a apply:

If you were never registered and filed no return, the failure-to-notify penalties in factsheet CC/FS11 apply instead:

For a non-deliberate failure to notify, a reasonable excuse removes the penalty. Whether a disclosure after a nudge letter counts as prompted is not settled in the letter. HMRC's manual at CH82421 calls it an objective test: a national campaign on its own does not make a disclosure prompted, but a disclosure can be prompted where HMRC has received information under an automatic exchange of information agreement, unless you had no reason to believe that information had been supplied. CC/FS7a describes an unprompted disclosure as one made before you have any reason to believe HMRC has discovered or is about to discover the problem. Because the letters are based on data about you, it is prudent to plan with the prompted ranges unless an adviser concludes otherwise. Within each range, the penalty falls the more you tell, help and give access, but if you take three years or more to disclose, HMRC normally restricts the reduction so the penalty stays at least 10 percentage points above the minimum.

Interest runs daily from the original payment date. HMRC's late payment interest rate is Bank Rate plus 4 percentage points and has been 7.75% since 9 January 2026; it changes when Bank Rate changes. HMRC can generally assess 4 years back, 6 years for careless errors and 20 years for deliberate behaviour or failure to notify, under sections 34 and 36 of the Taxes Management Act 1970.

Worked example: an unreported gain from 2022/23

A higher-rate taxpayer filed a 2022/23 return that left out a £20,000 crypto gain. No other gains used the annual exempt amount. The gain after the £12,300 allowance is £7,700, and the tax at 20% is £1,540. If HMRC accepts that reasonable care was taken, only tax and interest are due. If the error was careless and the disclosure is treated as prompted, the penalty lies between 15% and 30%, so between £231 and £462. If the disclosure comes three years or more after the return was filed, the restricted range of 25% to 30% applies, so between £385 and £462. Interest runs from 31 January 2024, the payment date for 2022/23. The year is closed for amendment, so the correction goes through the disclosure service.

Had the same person never registered for Self Assessment, the failure-to-notify table would apply instead: more than 12 months after the tax was due and prompted, the range is 20% to 30%, so between £308 and £462, unless there was a reasonable excuse.

If you cannot pay within 30 days, HMRC's guidance on paying tax on cryptoassets asks you to contact it as soon as you have the payment reference. HMRC treats exchange tokens as located where the beneficial owner is resident, so offshore penalty rules usually do not apply to a UK resident's exchange tokens; confirm this with an adviser if your case involves foreign income or gains or tokens linked to an underlying asset.

Losses and overpayments: claim them too

A review often reveals losses as well as gains. Capital losses must be claimed within 4 years after the end of the tax year in which you disposed of the asset; only claimed losses can reduce later gains. If you paid too much tax, overpayment relief can also be claimed up to 4 years after the end of the tax year concerned, by a signed letter stating the year, the amount and why you overpaid. The UK crypto losses guide explains claims and carry-forward.

Some HMRC campaigns on offshore income asked people to sign a "certificate of tax position". The crypto templates published so far do not include one. For the offshore letters, the Chartered Institute of Taxation has noted that there is no legal obligation to sign and that HMRC accepts a reply by letter instead. If you receive such a certificate about crypto, take advice before signing a statement that covers all years.

What changes from April 2027

Draft legislation published on 13 July 2026 for the next Finance Bill proposes two changes from 6 April 2027. Lending crypto and depositing it into liquidity pools would be treated as "no gain, no loss" in many cases, and gains on eligible stablecoins held by individuals would be exempt from Capital Gains Tax, with interest-like returns taxed as savings income. These are drafts: the Budget on 28 October 2026 and the Finance Bill can still change them. They do not affect the years a nudge letter asks you to review.

Records that make your answer credible

Whether you amend, disclose or simply keep your workings, the same records carry the answer: exchange exports, wallet addresses, transaction hashes, sterling valuations with their source, pool calculations and income records. HMRC's letter states that it cannot work out your tax position for you, so these records are your responsibility.

A CoinTaxReporting UK report imports exchange and wallet data and applies same-day matching, the 30-day rule and the Section 104 pool in pounds sterling. It leaves the annual exempt amount to the return itself. Before you rely on any report, check every disposal without a documented acquisition cost; a missing cost should be researched, not left at zero. A report does not decide whether your behaviour was careless or whether a disclosure was prompted; for those questions, and for large or old liabilities, speak to a tax adviser. Filing steps are covered in the guide on reporting crypto to HMRC.

Frequently asked questions about HMRC crypto letters

Official sources

• HMRC Compliance Handbook CH600110: One to Many approach
• HMRC Compliance Handbook CH82421: prompted and unprompted disclosures
• GOV.UK: Tell HMRC about unpaid tax on cryptoassets
• GOV.UK: Pay tax on cryptoassets
• HMRC factsheet CC/FS11: penalties for failure to notify
• GOV.UK: when you need to report Capital Gains Tax
• HMRC Cryptoassets Manual CRYPTO22600: location of exchange tokens
• Taxes Management Act 1970, section 36: extended time limits
• HM Treasury draft: tax treatment of cryptoasset loans and liquidity pools

Sources checked on 16 October 2026. Letter quotations come from the July 2026 template published by ICAEW; individual letters may differ. Figures on letter volumes come from FOI data reported in the press, not from HMRC publications.

Disclaimer: This article is for general informational purposes only and does not constitute tax advice. For individual tax advice, consult a licensed tax professional.