The UK government sent more than 81,000 warning letters during the 2025/2026 financial year to crypto holders it suspects of owing unpaid taxes.
A freedom of information request seen by the BBC revealed that the volume of letters from HM Revenue and Customs (HMRC) had tripled from 27,714 in 2024.
Unpaid taxes stem from crypto bull run
HMRC believes most of the unpaid taxes stem from gains made during the crypto bull run between 2022 and 2025.
The letters remind UK crypto users that if they sell, give away, exchange or make a purchase with crypto, they may need to pay capital gains tax.
If they don’t pay, they face a possible penalty of up to 100% of their owed tax with interest. This increases when it comes to offshore transfers.
HMRC plans to track wealthy crypto holders with ease
Neela Chauhan, a partner at accounting firm UHY Hacker Young, told the BBC, “A lot of the traders are young, have had little previous exposure to HMRC and often work under the assumption that HMRC has limited visibility over their activities.”
Chauhan adds that tax authorities suspect many crypto investors are evading tax, and that tracking the unpaid taxes of wealthy crypto users will be like “shooting fish in a barrel” once HMRC acquires new powers next year.
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These powers will force offshore crypto firms to divulge customers’ information to HMRC. The body estimates this will raise £315 million by 2030.
UK banks are also tight on crypto
Meanwhile, there’s still friction between UK banks and crypto investors.
A number of MPs representing a crypto and digital assets all-party parliamentary group recently reached out to UK banks to complain about the crypto restrictions in place and their effect on the wider crypto market.
They claim there have been “repeated instances” where crypto firms struggle to open bank accounts, and that these restrictions “could be one of the single biggest barriers to growth for UK crypto and digital asset businesses.”
