Individuals who received, sold or exchanged cryptoassets may be subject to income tax or capital gains tax (CGT) that should be reported on a self assessment tax return, due by 31 January 2024.

HMRC has issued a reminder to individuals who held cryptoassets in the 2022/23 tax year. Many individuals may not realise that they have a filing requirement due toholding cryptoassets, especially where no money has been received. The exchange of one cryptoasset for another cryptoasset is considered a taxable event and may give rise to a capital gain or loss.  

HMRC is reminding people to check whether they have a filing obligation for the 2022/23 tax year. Failure to file a self assessment tax return by 31 January 2024 may result in penalties and interest on unpaid tax. 

For the 2022/23 tax year, the capital gains annual exempt amount is £12,300. Where disposals over the year have given rise to gains exceeding this amount, this must be reported to HMRC. The taxpayer should then pay any associated CGT. Where proceeds from disposals over the tax year cumulatively exceed £49,200, they must also be reported on a self assessment tax return. Depending on the value and frequency of crypto transactions over the tax year, individuals may inadvertently exceed these thresholds. 

If cryptoassets are received from an employer this may be considered as earnings from employment. Income tax and national insurance contributions (if applicable) are typically withheld through PAYE. Other income from cryptoassets (eg from mining) may be treated as other taxable income and subject to income tax.  

HMRC has published guidance on the taxation of cryptoassets and has a dedicated cryptoassets manual with further detail on how it interprets the rules for the taxation of cryptoassets. 

Where individuals have unreported tax liabilities relating to past tax years, they can use HMRC’s new disclosure facility for cryptoassets.   

ICAEW’s Tax Faculty is recognised internationally as a leading authority and source of expertise on taxation. The faculty is the voice of tax for ICAEW, responsible for all submissions to the tax authorities. Join the Faculty for expert guidance and support enabling you to provide the best advice on tax to your clients or business.

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