Is Keir Starmer Coming For Your Crypto? UK Crypto Tax Raid Targets 65,000 Traders
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Ben Graham
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Is Keir Starmer coming for your crypto? UK crypto tax raid fears grow, as HMRC crypto tax letters are distributed to 65,000 British crypto traders.
The UK crypto tax authority, HMRC, has doubled the number of crypto warning letters it sends, signaling a tougher approach to undeclared digital-asset gains under the new government.
According to a Financial Times report, HM Revenue & Customs (HMRC) has issued about 65,000 “nudge” letters to residents suspected of under-reporting crypto profits for the 2024–25 tax year, more than twice the 27,700 sent the year before.
The campaign is meant to push more investors to voluntarily disclose their gains as HMRC gains deeper access to crypto-exchange data.
Falling capital-gains tax (CGT) allowances have also widened the net, bringing more traders into the tax system.
The Financial Conduct Authority estimates that roughly 12% of British adults, around 7M people, now hold crypto, highlighting the scale of those who could be affected.
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How Does the UK’s New Crypto Tax Rule Affect Traders in 2025?
Under HMRC rules, CGT applies when investors sell crypto, trade one token for another, use it for purchases, or gift it, except in limited cases.
From the 2024-25 tax year onward, Self Assessment forms include a dedicated crypto asset section, making it easier both to report and for HMRC to review.
The UK’s latest crypto tax push is widening the net for traders. The Capital Gains Tax (CGT) allowance has dropped sharply to £3,000 for the 2024/25 and 2025/26 tax years, down from £12,300 just two years ago.
That means more people will now need to declare their crypto gains to HMRC. The surge in tax letters comes as the UK prepares to implement the Crypto-Asset Reporting Framework (CARF) starting January 1, 2026.
The system will force domestic crypto platforms to collect and share detailed user and transaction data with HMRC and international partners.
Notably, the new rules will also exclude cryptocurrency ETNs from UK ISA Investments – further pressuring UK crypto investors.
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What Does HMRC’s £100M Crypto Tax Plan Mean for Traders?
According to HMRC, CARF is designed to “provide visibility on the transactions of users of cryptoassets.” Those who fail to comply could face penalties, while shared data will help identify tax evasion across borders.
Treasury estimates suggest the new rules could generate £40M in 2026-27, rising to £110M in 2027–28, before settling around £80M a year by 2029-30. This broader crackdown fits within the Labor government’s plan to narrow the tax gap.
The 2025 Spending Review earmarks funding for 5,500 new compliance officers and 2,400 debt-management staff, targeting an additional £7.5Bn in annual revenue by the end of the decade.
By sending 65,000 letters, double last year’s count, HMRC aims to combine enforcement with deterrence. With new data-sharing powers and deeper access to exchange records, traders will find it much harder to hide undeclared crypto profits.
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