UK Tax Authority Sends 81,000 Warning Letters to Crypto Traders

The UK tax authority, HMRC, sent over 81,000 letters to crypto holders during the 2025 financial year. This is a massive jump from the 27,714 letters sent the previous year. The agency is targeting unpaid capital gains taxes tied to the recent crypto bull market.

These notices serve as a reminder that selling, trading, or spending crypto can trigger tax liabilities. If investors fail to report these gains, they face heavy penalties reaching up to 100 percent of the owed tax plus interest. The government is particularly focused on ensuring offshore transfers are properly reported.

Looking ahead, HMRC expects to gain new powers next year that will require offshore crypto exchanges to share user information directly with them. This shift aims to make it much easier for the government to identify wealthy traders. Officials estimate these measures will bring in 315 million pounds by 2030.

Separately, the crypto industry continues to face banking hurdles in the UK. A group of members of parliament recently flagged that crypto businesses struggle to open bank accounts, which they view as a major barrier to sector growth.