TLDR

  • Starting from January 1, UK – based crypto exchanges are required to report complete user data to HMRC.
  • 48 countries have adopted the CARF rules, and 75 countries, including the US, have committed to it.
  • HMRC will commence automatic cross – border data sharing in 2027.
  • Under the current UK rules, crypto gains exceeding £3,000 may lead to tax liability.

As of January 1st, 2026, the UK has initiated the enforcement of new international crypto tax reporting rules. Within this framework, major crypto exchanges are obliged to start collecting and reporting detailed transaction data to HM Revenue & Customs (HMRC). This step represents a new advancement in global tax cooperation, aiming for transparency in the digital asset realm.

This is part of the OECD’s Cryptoasset Reporting Framework (CARF), a global agreement designed to standardize the collection and exchange of crypto – related tax information. The UK is among the first 48 countries to start implementing the new rules.

HMRC to Receive Comprehensive User Transaction Data

All crypto platforms serving are now required to collect and report personal and transaction data. The necessary details encompass names, addresses, dates of birth, National Insurance numbers, tax residency, asset types, transaction dates, values, and purposes. This covers all activities such as trading, staking, swapping, mining, or gifting.

 

Beginning on January 1st, 2026, Reporting Crypto – Asset Service Providers (RCASPs) will start gathering data. They must submit full – year reports for 2026 to HMRC by May 31, 2027. This process applies to exchanges, custodial wallets, and any platform that handles user crypto activity.

Dawn Register, a tax dispute partner at BDO, stated that HMRC is ramping up efforts to address underreporting. She pointed out that the more comprehensive data sets enabled by CARF allow the authority to better target suspected non – compliance.

Automatic Cross – Border Data Sharing From 2027

The UK is getting ready to automatically share crypto tax data with other CARF – aligned countries. This sharing will start in 2027 and involve EU member states as well as countries like Brazil, South Africa, the Cayman Islands, and the Channel Islands. In total, 75 countries have committed to joining the CARF system. The United States will adopt the rules in 2028 and start exchanging data in 2029.

Participating jurisdictions will share data to help identify unreported crypto profits across borders. Andrew Park, a tax specialist at Price Bailey, said that the privacy once associated with crypto transactions is now coming to an end. He warned investors in member countries that their transaction data will be accessible to tax authorities worldwide.

UK Crypto Users Face Wider Tax Enforcement

The new framework does not introduce additional taxes, but it increases the level of scrutiny. HMRC can now compare the data submitted by platforms with individuals’ tax returns. Users with gains over £3,000 may be subject to Capital Gains Tax ranging from 10% to 20%, or Income Tax if their trading appears frequent or business – like.

Tax liabilities may also apply when crypto is used to purchase items, swapped for other tokens, or given as gifts. The only exemption is for transfers between spouses or civil partners. All transactions are evaluated separately for tax purposes.

During the 2024–2025 tax year, HMRC sent 65,000 letters to individuals suspected of failing to report crypto gains, up from 27,700 the previous year. This indicates an increased enforcement and monitoring capacity under CARF.

Exchanges Must Meet Strict Compliance Requirements

are expected to invest in secure systems for storing and reporting user data. The infrastructure should enable accurate record – keeping and the timely submission of required information to HMRC.

The rules demand a professional level of compliance, similar to that applied to traditional financial institutions. Authorities claim that this move firmly brings crypto within the scope of formal tax systems and aligns it with broader financial reporting.

The number of crypto owners in the UK is estimated to be between 6 and 7 million people, or around 10 – 12% of adults. Many of them are now subject to tax reporting and compliance requirements similar to those for bank accounts and traditional investments. The Financial Times that this shift reflects a broader trend towards transparency in digital assets. The UK’s early enforcement places it at the forefront of global crypto tax regulation.