How to file your crypto taxes with HMRC

CRYPTOUK TAX
4 min read
First published:
Last updated:
David Collins, Head of Growth, Recap
Written by
David Collins,
Head of Growth

This article is not intended as tax advice - if you are unsure how to file your self-assessment you should consult a tax professional.

TL;DR

  1. Check if you need to file a crypto-tax return for free with Recap
  2. Register for self-assessment with HMRC.
  3. Fill out SA100 and SA108 using data from Recap and submit your tax return before the 31st of January 2023 (although if you file up to three months late, you'll pay a £100 penalty and there is a 5% surcharge on the balance of tax unpaid at 28 February 2023)
  4. Pay what you owe then relax, you've completed your tax return 🎯

Step 1 - Check if you need to file

There are many reasons that you might need to file a self-assessment, and not all of them are crypto related. There's a handy tool to check if you need to file provided by the government.

For this post, we'll focus on crypto activity.

There are three main "crypto" reasons that you might need to file a self-assessment:

  1. If you've made capital gains over your CGT annual exemption (currently £12,300)
  2. If your total disposal proceeds exceed four times the CGT annual exemption (currently £49,200)
  3. If your crypto income is above the Trading and Miscellaneous Income Allowance (£1,000)

There are other reasons that you might need to file and everybody's individual circumstances are different. You should always speak with a tax professional if you are unsure.

How do I know if my crypto falls into one of the above categories?

Recap can help. Sign up for a free account and connect your exchanges and wallets. Once your data is synced our dashboard will tell you if we think you need to file.

Once you've connected your accounts, check your activity is accurately reported and that your calculations are correct. Once you are happy you can download our Capital Gains and Income Reports to get all the numbers you'll need to file your tax return.

Step 2 - Registering for self-assessment

If you need to file a self-assessment you'll need to ensure that you are registered for self-assessment.

A screenshot of the sign in to the Government Gateway

If you’ve registered to file a self-assessment tax return before - you don’t need to register again, just go ahead and sign in.

If it's your first time filing you needed to register by the 5th of October. However, if you've missed the deadline don't panic! Speak to a tax advisor about the best way forward.

The steps to register are slightly different depending on whether you’re self-employed or not.

If you’re not self-employed, register online using form SA1. Once complete, you'll get your Unique Taxpayer Reference Number (UTR) within 10 days (or 21 if you're abroad). Once you've got your UTR you can complete the online registration process. You'll then get an activation code in the post within 7 days of registration (or 21 days if you're abroad) which can be used to complete the process.

If you're self-employed, sign into your business tax account and add Self Assessment. Once you've done this you'll get a letter containing your Unique Taxpayer Reference Number (UTR). You'll also receive a second letter with an activation code. These two together can be used to complete your registration and enable you to file. You'll usually get both of these within 10 days (21 if you are abroad).

Take a look at this article to find out how to register for self assessment in more detail.

Step 3 - Filing your crypto self-assessment

Now you've got your self-assessment account set up you can go ahead and complete the filing process before the 31st January deadline. Generally speaking, there are two types of tax related to crypto - we'll cover how to file both below:

Reporting Capital Gains Tax

Screenshot of tax form for "Other property, assets and gains"

Capital gains or losses are submitted using form SA108. The Capital Gains Tax Summary is split into 7 sections. You need to use the second section - boxes 14,15,16,17 and 19 to submit your crypto data.

Everything you need is listed on the last page of the Capital Gains PDF Report from Recap:

  • Box 14 = Number of disposals
  • Box 15 = Disposal proceeds
  • Box 16 = Allowable costs
  • Box 17 = Gains in the year, before losses
  • Box 19 = Losses in the year

You can report any losses or adjustments in section 5 - boxes 45 to 52.

Box 45 is for capital losses brought forwards from earlier years which you are using this year.

Losses carried forward to later years are included in box 46.

Reporting Crypto Income

Some crypto activity is taxed as income. You can read more in our guide. Remember - every individual's tax situation is different and it's important to know your own circumstances before filling.

If you want to declare some of your crypto proceeds as income, you can use the PDF Income Report from Recap along with form SA100.

  • Box 17 = Other taxable income (This is called Net Income in our report)
  • Box 18 = Total allowable expenses (we don't track this in Recap) - seek professional tax advice on what expenses you can claim and when the trading allowance of £1,000 can be deducted.
  • Box 21 = A description of the income - this box is quite small so you can add more detail (or attach the Recap PDF) as part of the "Any other information" section later on.

Step 3 - How to pay your taxes

The deadline for paying your taxes is also 31st January and there are three different ways to pay:

Pay online

If you reported your Capital Gain using HMRCs real time service
you can pay online by debit or credit card.

Bank Transfer

You can also pay by bank transfer using online or telephone banking. It usually takes up to 3 working days for your payment to reach HMRC.

Cheque

If you like to be really old school you can also send a cheque by post to HMRC. Just be sure to fill it in correctly and write your 14-digit Capital Gains reference number (starts with ‘x’) on the back. Agaain, it usually takes 3 working days for your payment to reach HMRC.

What if you can't pay your taxes on time?

If you can't pay your capital gain taxes on time you may be able to set up a payment plan with HMRC which lets you pay in instalments.

To proactively manage your crypto taxes all year round check out our new dashboard.

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