HMRC has sharply escalated its crypto tax enforcement in the UK, sending over 81,000 warning letters to holders in the 2025-2026 financial year, nearly triple the 27,714 letters sent in 2024. The tax authority suspects much of the unpaid tax stems from gains during the 2022-2025 bull run. Recipients are reminded that tax obligations arise when crypto is sold, given away, exchanged, or used for purchases, with penalties reaching up to 100% of tax owed. A broader crackdown looms in 2027 when new powers will require offshore firms to hand over customer data, a measure expected to raise $430 million by 2030. Separately, UK banks face scrutiny over blocking roughly 40% of transfers to digital asset exchanges.
HM Revenue and Customs has significantly increased its scrutiny of UK crypto users during the 2025-2026 financial year. The tax authority reportedly sent more than 81,000 warning letters to holders it suspects may have unpaid tax.
The number is nearly three times higher than the 27,714 letters sent in 2024. HMRC believes a large share of the unpaid tax relates to gains made during the crypto bull run between 2022 and 2025.
The tax authority has reminded recipients that obligations can arise when crypto is sold, given away, exchanged, or used to make purchases. Failure to pay can result in penalties of up to 100% of the tax owed, in addition to interest, while offshore transfers potentially carry greater consequences.
The crackdown is also set to become broader as HMRC prepares to receive new powers in 2027. Offshore firms will be required to hand over customer information to the UK tax authority, which estimates the measure could raise $430 million by 2030.
Neela Chauhan, a partner at accounting firm UHY Hacker Young, told the BBC that many traders are young and have had little previous experience dealing with HMRC. She said some operate on the assumption that the agency has limited visibility into their crypto activity.
Chauhan also said authorities suspect many investors of evading tax. She suggested that identifying unpaid liabilities among wealthy holders could become considerably easier once the new powers take effect.
While HMRC is tightening oversight, banking access is becoming a serious concern for the industry. Earlier this month, Parliament’s Crypto and Digital Assets All-Party Parliamentary Group asked the chief executives of major UK banks to explain how they deal with cryptocurrency businesses.
The group asked banks about their policies, transaction limits, and whether the country’s incoming crypto rules could change their approach. Labour MP Gurinder Singh Josan and Lord Vaizey of Didcot sent the letter after hearing repeated complaints from firms unable to open bank accounts.
Research from the UK Cryptoasset Business Council found that banks were blocking or delaying around 40% of attempted transfers to digital asset exchanges.
