HMRC sent nearly 65,000 warning letters to crypto investors last year, more than double the previous year, as the UK steps up efforts to trace undeclared capital gains.
News
The UK tax authority has ramped up its scrutiny of crypto investors, doubling the number of warning letters sent to those suspected of underreporting or evading taxes on digital asset gains.
HM Revenue & Customs (HMRC) issued nearly 65,000 letters in the 2024–25 tax year, up from 27,700 the year before, the Financial Times on Friday, citing data obtained under the Freedom of Information Act.
The letters, known as “nudge letters,” are designed to prompt investors to voluntarily correct their tax filings before formal investigations are launched.
The sharp increase reflects HMRC’s growing focus on crypto-related tax compliance. Over the past four years, the agency has sent more than 100,000 such letters, with activity accelerating as crypto adoption and asset prices surged.
Related:
7 million UK adults own crypto
The Financial Conduct Authority that seven million UK adults now hold crypto, up from around 10% (5 million) in 2022 or 4.4% (2.2 million) in 2021, showing the growing interest.
“The tax rules surrounding crypto are quite complex and there’s now a volume of people who are trading in crypto and not understanding that even if they move from one coin to another it triggers capital gains tax,” Neela Chauhan, a partner at UHY Hacker Young, which submitted the FOI request, told the FT.
HMRC’s visibility into the market has improved dramatically. The agency now receives transaction data directly from major crypto exchanges and will gain automatic access to global exchange data from 2026 under the Organisation for Economic Co-operation and Development (OECD)’s .
Related:
US lawmakers weigh crypto tax exemptions
US senators are , including exempting small transactions from taxation and clarifying how staking rewards are treated.
During a Senate Finance Committee hearing earlier this month, lawmakers debated whether everyday crypto payments should trigger capital gains tax and how to fairly classify income generated from staking services. Coinbase’s vice president of tax, Lawrence Zlatkin, urged Congress to adopt a for crypto transactions under $300.
Meanwhile, South Korea’s National Tax Service (NTS) has on crypto tax evasion, warning that even assets stored in cold wallets will be seized if linked to unpaid taxes.
Magazine:
