TL;DR: Yes. Kraken operates in the UK through FCA-registered companies, which means it sits squarely within HMRC's reach, and from 1 January 2026 it is expected to fall within the Cryptoasset Reporting Framework (CARF), under which in-scope exchanges must report UK customer data to HMRC every year, with the first reports due by 31 May 2027. HMRC has long had the power to compel exchanges to hand over customer data, and it has been using crypto data to chase undeclared tax for years. If you have traded on Kraken and not declared your gains or income, it is far better to come forward now than to wait for HMRC to come to you.
This guide covers what HMRC can already get from a UK-registered exchange like Kraken, what CARF changes, where Kraken sits with the regulators, and the practical steps if you think you owe tax. It reflects HMRC, FCA and OECD positions as of June 2026.
Disclaimer
This guide is intended as a generic informative piece. This is not accounting or tax advice that can be relied upon for any UK individual's specific circumstances. Please speak to a qualified tax advisor about your specific circumstances before acting upon any of the information in this article.
Does Kraken currently share data with HMRC?
There is no public record of Kraken handing a bulk list of UK customers to HMRC in the way Coinbase did in 2021. But that is not the reassurance it might sound like. HMRC has broad powers to obtain customer data from financial businesses, and a UK-registered exchange is exactly the kind of business it can serve a notice on.
Those powers come from two pieces of legislation: Schedule 23 of the Finance Act 2011, which allows HMRC to demand bulk data from third parties, and Schedule 36 of the Finance Act 2008, which underpins individual information notices. HMRC has previously used these powers to obtain data from crypto exchanges serving UK customers, and the sheer scale of its crypto enforcement (more on that shortly) shows it has been steadily building a picture of who trades and what they hold.
So the honest position is this: HMRC may already hold Kraken-related data obtained through its information powers, and even where it does not, Kraken's UK registration means it is well within reach. From 2026 the question becomes academic, because reporting stops being something HMRC has to ask for.
What changes from 1 January 2026: the Cryptoasset Reporting Framework
The Cryptoasset Reporting Framework, CARF for short, is the OECD's mechanism for making crypto visible to tax authorities the way bank accounts already are. The UK wrote it into law through The Reporting Cryptoasset Service Providers (Due Diligence and Reporting Requirements) Regulations 2025, and it takes effect on 1 January 2026. For the detail on the framework itself, see our explainer on the OECD's CARF release.
For Kraken the change is real. As a UK-based exchange it is expected to fall within the CARF reporting rules for UK users, which would move it from a position where HMRC has to ask for data to one where the data simply arrives, once a year, automatically. Think of it as the crypto counterpart to the Common Reporting Standard, the arrangement that has been swapping offshore bank-account information between more than 100 countries for years. That same plumbing now reaches crypto exchanges.
What information will Kraken report to HMRC under CARF?
CARF sets out precisely what an in-scope exchange has to hand over for each UK-resident customer. It splits into two buckets: who you are, and what you did.
| Identity data | Transaction data |
|---|---|
| Full name | Transaction types (exchanges, transfers, spending) |
| Date of birth | Annual aggregate value |
| Home address | Units and asset type |
| Country of tax residence | - |
| National Insurance / UTR | - |
That information lands with HMRC and is then passed between CARF countries, so hopping between a UK platform and an overseas one does not put activity out of reach. Under HMRC's CARF guidance, the rules carry penalties for users and providers alike: a user who deliberately or carelessly fails to provide a valid self-certification can face a penalty of up to £300, while reporting providers face separate penalties for due-diligence, reporting, notification, registration and record-keeping failures.
When will HMRC start receiving Kraken data under CARF?
| Date | What happens |
|---|---|
| 1 January 2026 | Data collection begins for in-scope exchanges with UK customers. |
| 31 May 2027 | First reports due to HMRC, covering 2026. |
| From 2027 onwards | International CARF data exchange with other countries begins. |
So from the 2026/27 tax year, assuming Kraken falls within scope as expected, HMRC will get a yearly summary of reportable activity that it can line up against your Self Assessment return.
Is Kraken legal and regulated in the UK?
Kraken is legal to use in the UK, and its regulatory footprint is more layered than most exchanges. Kraken serves UK customers through several Payward group entities, which hold a range of FCA permissions:
- Payward Ltd is registered with the FCA as a cryptoasset business under the Money Laundering Regulations 2017 (firm reference number 928768), with effect from 22 November 2021.
- Payward Services Limited is authorised by the FCA as an electronic money institution under the Electronic Money Regulations 2011 (firm reference number 1010381).
- Crypto Facilities Limited, the entity behind Kraken's futures product, is an FCA-authorised investment firm (firm reference number 757895).
A word of caution on what this means. Being on the FCA's cryptoasset register is an anti-money-laundering registration, not a sign that crypto trading itself is a regulated, protected activity. Your crypto holdings are not covered by the Financial Services Compensation Scheme, and none of these registrations change your tax position. A regulated exchange reports to HMRC just the same, and you remain responsible for declaring your own gains and income.
Why has HMRC been sending nudge letters about crypto?
When HMRC believes your declared income does not match the data it holds, one of its first moves is a nudge letter. It is not a formal investigation, just a prompt to review your tax affairs and correct anything you have missed, usually noting that HMRC holds information suggesting undeclared crypto activity.
The numbers show how hard HMRC is leaning on this:
- 64,982 crypto nudge letters went out in the 2024/25 tax year.
- That is up from 27,713 the year before, a 134% rise in twelve months.
- The figures come from a UHY Hacker Young Freedom of Information request, reported by the Financial Times in October 2025.
Every one of those letters starts with a data match, and the pool of data behind it only deepens once CARF reporting kicks in. A letter is not an accusation, but leaving it unanswered is the costly choice: correcting your return after a nudge generally lands a lighter penalty than waiting for HMRC to open a formal enquiry. If a letter has arrived, our guide on what to do if you receive an HMRC nudge letter about your crypto walks you through it.
Can HMRC see my Kraken transactions?
Not in real time, and not by logging into your account. HMRC does not get a live view of your Kraken activity. What it gets is data obtained through information notices and, from 2026, CARF reporting. HMRC then matches that data against what you declared. So while nobody is watching your trades as they happen, HMRC can assemble a detailed record after the fact, which is all it needs to spot a return that does not line up.
Why Kraken activity is easy to under-report
Kraken is a full-featured exchange, and that breadth is exactly what makes its tax position fiddly. Most people use more than one product without thinking of each as a separate tax event.
- Spot trading. Every sale or swap of one crypto for another is a disposal for capital gains, even when no pounds change hands.
- Margin trading. Borrowed positions, fees and the way gains and losses are realised add complexity that simple buy-and-hold records miss.
- Futures. Kraken's futures product, run through its regulated Crypto Facilities entity, produces realised profit and loss that has to be accounted for separately from your spot holdings, with the exact treatment depending on the product and your circumstances.
- Staking rewards. Rewards earned from staking are income, valued at the point you receive them, on top of any later gain when you sell.
- NFTs and transfers. NFT trades, where you have them, are disposals too, and transfers between your own Kraken account and external wallets need matching so they are not mistaken for sales.
There is also a data quirk worth knowing. Kraken exports its history as a ledger, where trades, deposits, withdrawals, margin entries, staking rewards and transfers all appear as interleaved line items. Kraken's ledger format is one of the most common reasons people underestimate how long an accurate manual tax calculation takes, and it is an easy place to end up with figures that do not match what HMRC receives.
What should I do if I have undeclared Kraken gains?
Sitting on undeclared Kraken gains or income only gets more expensive the longer it runs. What helps most is getting ahead of HMRC, because a voluntary disclosure is treated far more leniently than something HMRC uncovers itself.
Three steps.
1. Work out what you owe. That means a full record of your Kraken activity: spot trades, margin and futures positions, transfers, and any income such as staking rewards. Run it through HMRC's share-pooling rules, which our comprehensive UK crypto tax guide walks through, and add any income tax on crypto you received. Our free crypto tax calculator is handy if you just want a rough number on a single disposal.
2. Tell HMRC. Where the year is still open, the fix is an amendment to your Self Assessment return: you get 12 months from the filing deadline, so a return submitted by 31 January 2026 can be changed up to 31 January 2027. For years that have already closed, HMRC's dedicated channel is the Cryptoasset Disclosure Facility, open since November 2023 for unpaid Income Tax or Capital Gains Tax on crypto.
3. Pay what is due. Late tax attracts interest, and usually a penalty on top. Since that penalty shrinks the moment you disclose before HMRC reaches you, there is a genuine cost to delay.
Only a qualified accountant can advise on your specific position, and the right one will handle the disclosure and work to keep the penalty down. Our directory lets you find a Recap-verified UK crypto tax specialist.
One pattern we see a lot: people who keep clean records of their spot trades but lose track of futures profit and loss, margin activity and staking rewards, all of which sit in different parts of the Kraken ledger. Those are the entries that most often go missing, and they are exactly the ones HMRC's data will eventually include.
How Recap helps with Kraken tax
Recap connects to Kraken and pulls your full history into one place, then classifies and values each transaction so you get a complete UK tax report. You can connect your Kraken account via API, or import your Kraken ledger and trades CSV exports if you prefer. Recap reads the whole ledger, from spot trades and transfers to margin, futures profit and loss, staking rewards and NFT activity, and works out your gains and income using HMRC's rules. You can see the full setup on our Kraken integration page.
Connect your Kraken account to Recap to turn your full trading history into UK gains, income figures and an HMRC-ready report you can file or hand to your accountant.
References
- HMRC and OECD: Cryptoasset Reporting Framework, domestic reporting of UK-resident cryptoasset users
- HMRC: Implementation of the Cryptoasset Reporting Framework (penalties for users and reporting providers)
- The Reporting Cryptoasset Service Providers (Due Diligence and Reporting Requirements) Regulations 2025
- Schedule 23, Finance Act 2011
- Schedule 36, Finance Act 2008
- HMRC Cryptoasset Disclosure Facility
- Nudge-letter statistics: UHY Hacker Young FOI, reported by the Financial Times, October 2025
- Kraken UK FCA status: Payward Ltd, cryptoasset business registration FRN 928768, effective 22 November 2021; Payward Services Limited, EMI authorisation FRN 1010381; Crypto Facilities Limited, authorised investment firm FRN 757895
