Millions of UK cryptocurrency holders will soon be required to disclose their personal details to digital asset platforms, as HM Revenue & Customs (HMRC) rolls out a sweeping new crackdown on tax avoidance in the sector.
From 1 January 2026, crypto exchanges and marketplaces will be obliged to collect and report information on users and transactions to HMRC as part of a coordinated global effort to improve tax transparency and combat non-compliance in the digital economy.
The rules will apply to both individuals and businesses engaged in buying and selling cryptoassets, and mark the latest expansion of HMRC’s digital surveillance powers following the introduction of the so-called “side hustle tax” on online sellers using platforms such as Airbnb, Vinted and Etsy.
Recent data from the Financial Conduct Authority suggests that around 12 per cent of UK adults – more than six million people – now hold some form of cryptocurrency.
Under the new regime, individuals will need to supply their name, date of birth, home address, country of residence, and – if based in the UK – their National Insurance number or Unique Taxpayer Reference (UTR). Overseas investors will need to provide their tax identification number and the issuing country.
Businesses trading in crypto must submit their legal name, registered address, and relevant company registration or tax identification details depending on their location.
Platforms will also be required to report the value, type, and nature of each transaction, along with the number of crypto units involved. Exchanges that fail to comply face fines of up to £300 per user for submitting inaccurate or incomplete reports.
Seb Maley, CEO of tax insurance specialist Qdos, said the move signals a new phase in HMRC’s pursuit of tax revenue from digital sectors.
“HMRC is casting its net far and wide as it looks to crack down on suspected tax avoidance and non-compliance among cryptocurrency holders,” Maley said. “By collecting the personal information of those buying and selling crypto – along with the values being exchanged – HMRC will know how much tax should be paid on these assets.”
He added that the data-sharing requirement will significantly bolster HMRC’s ability to cross-reference taxpayer records with third-party information. “In simple terms, if the income a taxpayer declares on their self-assessment doesn’t match what these platforms report, HMRC has the data it needs to open a tax investigation.”
The new measures reflect HMRC’s participation in a broader global initiative led by the OECD, known as the Crypto-Asset Reporting Framework (CARF), which aims to close tax loopholes in fast-growing digital markets by ensuring consistent reporting standards across borders.
“These rules are another sign of how HMRC is working with tax authorities globally to align on how to police compliance – particularly in fast-growing, digital industries, such as crypto and the gig economy,” Maley said.
The clampdown comes amid a wider shift in regulatory attitudes toward cryptocurrencies, with both the UK and EU progressing legislation to bring digital assets under stricter financial oversight. In the UK, the government has pledged to make the country a “global crypto hub,” while also ensuring proper tax and consumer protections are in place.
Industry observers say the rules could impose an additional administrative burden on platforms but will ultimately bring more legitimacy to the crypto sector by aligning it with traditional financial compliance expectations.
