HMRC recovers more than £8million from investors through major tax crackdown

HMRC has recovered more than £8million from cryptocurrency investors who failed to pay the correct tax on their digital asset gains.

Figures released following a Freedom of Information request show 502 people reached disclosure agreements with the taxman over the past two tax years, with the average settlement worth around £16,600.

Zurab Kotaria, chief operating officer at financial services compliance firm Identomat, which submitted the Freedom of Information request, said the figures reflected a wider compliance drive.

He said: "These settlements are part of a broader compliance crackdown by the authorities which has significant implications for both crypto investors and the platforms they use."

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The recoveries follow HMRC's dedicated crypto disclosure campaign, which launched in November 2023.

During the 2024/25 financial year, 280 cryptocurrency investors agreed settlements worth a combined £3.5million.

In 2025/26, fewer investors came forward, with 222 reaching agreements, although the total value of settlements increased to around £4.8million.

The increase in the average settlement suggests HMRC is recovering larger amounts through its compliance work.

The disclosure campaign encouraged people holding exchange tokens, non-fungible tokens and utility tokens to declare any unpaid tax liabilities.

It was introduced alongside an increase in so-called "nudge letters" sent to investors HMRC suspected had not paid the correct tax on cryptoasset gains.

Under current UK tax rules, disposing of cryptoassets may trigger capital gains tax where profits exceed the annual tax-free allowance of £3,000.

The annual exemption has fallen significantly from £12,300 in the 2022/23 tax year.

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Where HMRC considers cryptocurrency trading to amount to a business activity, profits may instead be subject to income tax and National Insurance contributions.

A separate Freedom of Information request by BrokerChooser found HMRC sent 101,024 "nudge letters" to suspected non-compliant cryptocurrency investors between 2020 and 2025.

The number of letters increased from 8,329 in 2021/22 to 27,712 in 2023/24 before rising to 64,982 in 2024/25.

The UK has also adopted the OECD's Cryptoasset Reporting Framework, known as CARF, alongside more than 40 other countries.

Since January, UK cryptocurrency service providers have been required to collect customer identification details, tax residency information and transaction records.

HMRC said in its latest annual report: "We will exchange that information on non-UK tax residents with relevant international partners and receive information from them on UK tax residents."

The compliance campaign comes as cryptocurrency ownership continues to grow across Britain.

Research by the Financial Conduct Authority published this year estimated around 4.5 million adults, or roughly eight per cent of the population, now own digital assets, more than double the number recorded in 2020.

The regulator said the average UK cryptocurrency portfolio is worth around £2,250, although most investors hold less than £1,000 in digital assets and around 16 per cent have portfolios worth more than £5,000.

Dawn Register, a partner in BDO's tax dispute resolution team, said the number of settlements remained small compared with the size of the UK's cryptocurrency market.

She said: "A very small number.

"However, I would say this is the tip of the iceberg in terms of non-compliance. I still meet a lot of taxpayers who still view crypto investing as gambling and they are not aware that the gains are taxable."

HMRC said the settlement figures "do not reflect the full extent" of its compliance activity and should not be interpreted as measuring either the overall level of crypto tax evasion or the effectiveness of its enforcement work.

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