The UK tax authority sharply escalated its scrutiny of cryptocurrency investors during the 2025-26 financial year, sending 81,172 warning letters, emails and text messages about possible unpaid tax.

The figure nearly triples the 27,714 messages dispatched during 2023-24, underscoring a major expansion of HM Revenue and Customs' (HMRC) crypto compliance programme. The data was reported this week after a Freedom of Information request obtained by accountancy firm UHY Hacker Young.

HMRC Targets Undeclared Crypto Gains

HMRC has warned that investors can face tax obligations when they sell cryptocurrency for a profit. Under the authority's published guidance, disposals of cryptoassets are generally subject to Capital Gains Tax, and tax can also arise when one cryptocurrency is exchanged for another, or when digital assets are used to purchase goods and services.

The warnings do not necessarily mean recipients owe tax. Instead, they signal that HMRC has identified activity that could point to undeclared income or capital gains. The authority has built that picture partly through information notices served on UK-facing crypto exchanges, which have required firms to hand over customer records that can be cross-checked against tax returns.

The enforcement surge follows a strong crypto market rally. Bitcoin climbed from roughly £14,000 in December 2022 to around £90,000 by October 2025, and HMRC believes some gains from that period may remain unreported. It also comes as the tax-free threshold for gains has narrowed: the capital gains annual exempt amount was cut from £12,300 to £6,000 in April 2023 and again to £3,000 from April 2024, bringing more modest gains within taxable scope.

The authority's growing focus has prompted accountants to urge crypto investors to review their records and reporting history. Taxpayers who identify gaps can approach HMRC through its disclosure process, under which the authority's published penalty framework treats voluntary disclosure more favourably than cases it uncovers itself.

International Data Sharing Adds Pressure

HMRC is also preparing for far broader access to cryptocurrency transaction information. From March 2027, crypto platforms in dozens of countries outside the UK are expected to share customer information with tax authorities under new international reporting arrangements aligned with the OECD's Crypto-Asset Reporting Framework (CARF).

The UK is adopting the framework domestically as well, with UK-based crypto service providers due to begin collecting reportable customer information from 1 January 2026, ahead of the first international exchanges.

HMRC estimates those changes could generate as much as £315 million in additional tax revenue by April 2030.

For UK investors, the direction is increasingly clear: cryptocurrency activity is becoming harder to keep outside the tax system. As authorities gain access to more exchange and transaction data, investors with previously undeclared gains may face greater scrutiny.