Crypto tax in the UK
Swapping one cryptoasset for another is a taxable disposal in the UK, even when no pounds are involved and no account was ever opened. This page sets out how HMRC arrives at that answer, how a gain is actually calculated through Section 104 pooling and the matching rules, which events count as income instead, and what changed when the Cryptoasset Reporting Framework went live in January 2026. It is general information about published rules, not tax advice — for your own position, speak to a qualified adviser.
What counts as a disposal
The trigger is the disposal, not the cash-out. Most UK crypto tax surprises come from this list.
A crypto-to-crypto swap is a disposal
HMRC does not wait for you to reach pounds. Trading BTC for ETH disposes of the BTC at its sterling market value on the day of the swap, and simultaneously acquires ETH at that same value. This is the single most misunderstood rule in UK crypto tax, and it is the one that applies to every order you place through SwapRocket.
Also disposals
Selling crypto for GBP or any other fiat currency, paying for goods or services in crypto, and gifting crypto to anyone other than your spouse or civil partner. Each is valued in sterling at the moment it happens.
Not disposals
Buying crypto with pounds and holding it. Moving coins between wallets you control — including sending to a hardware wallet or consolidating addresses. Gifting to a spouse or civil partner. Network fees paid on your own transfers are not a disposal of the transferred asset, though fees paid as part of a trade generally form part of the allowable cost.
Income, not capital
Mining and staking rewards, lending and DeFi yield, airdrops received in return for doing something, and salary paid in crypto are income at their sterling value when received. They then enter your pool at that value, so a later sale can also produce a separate capital gain or loss.
How the gain is calculated
1. Pool your costs (Section 104)
All units of the same token are treated as one pooled asset with one average cost. Buying 1 BTC at £20,000 and 1 BTC at £40,000 gives a pool of 2 BTC costing £60,000, so each unit costs £30,000 regardless of which coin you 'send'.
2. Apply the matching rules first
Disposals are matched against acquisitions on the same day first, then against acquisitions in the following 30 days, and only then against the Section 104 pool. This ordering exists to stop bed-and-breakfasting and it changes the answer whenever you re-buy soon after selling.
3. Work out the gain in sterling
Gain equals sterling proceeds, less the pooled allowable cost of the units disposed of, less allowable disposal costs. For a swap, proceeds are the sterling market value of what you received at the time of the trade — not what you paid originally.
4. Report and keep records
Capital gains go on the SA108 pages of your Self Assessment return; income events go in the income sections. Keep the date, both assets, the quantities, the sterling value and the fee for every order. Your SwapRocket order page holds the transaction details for each swap you make with us.
CARF: what HMRC now receives
- The UK activated the OECD's Cryptoasset Reporting Framework on 1 January 2026, so in-scope UK cryptoasset service providers began collecting reportable customer and transaction data from that date.
- Those providers submit their first reports to HMRC by 31 May 2027, covering the 2026 calendar year, and the data feeds HMRC's Connect matching system alongside bank and property records.
- Reported fields include legal name, address, date of birth, tax residency and National Insurance number or UTR, plus annual aggregate values and units per asset and transaction type.
- CARF did not create a new tax. It removes the assumption that unreported activity stays invisible, which makes a return that already matches provider data the only sensible position.
Worked example
You bought 1 BTC for £20,000 and later another 1 BTC for £40,000, giving a Section 104 pool of 2 BTC at £60,000 — £30,000 per coin. You then swap 0.5 BTC for ETH when Bitcoin is worth £50,000, so the sterling value received is £25,000. The allowable cost of those 0.5 BTC is £15,000, producing a £10,000 gain on the swap. The ETH enters a new pool with a £25,000 cost, and your BTC pool falls to 1.5 BTC costing £45,000. No pounds were withdrawn at any point.
Keep reading
- UK crypto regulationFCA registration, promotions rules and the Travel Rule.
- Instant crypto exchange UKAccount-free swaps for UK users.
- Crypto swap taxesHow disposals are treated across jurisdictions.
- Krypto-Steuern (DE)Die deutsche Fassung dieser Seite.
- No-KYC crypto exchange hubWhere verification is and isn't required.
- What KYC actually isWhy custody and fiat trigger identity checks.
Crypto tax UK — FAQs
Do I pay tax when I swap one crypto for another in the UK?
Usually yes. HMRC treats a crypto-to-crypto trade as a disposal of the asset you gave up, valued in pounds at the time of the swap. If that value exceeds your pooled cost for those units, the difference is a capital gain even though you never touched sterling. Losses work the same way and can be set against gains.
What is the capital gains tax rate on crypto in the UK?
Crypto gains are taxed at the standard Capital Gains Tax rates for non-residential assets, which depend on whether the gain falls in your basic or higher rate band once added to your income. Rates and the annual exempt amount change at Budgets, so check the current year's figures on GOV.UK before filing rather than relying on an article.
Does using a no-KYC exchange remove the tax?
No. The reporting duty sits with you, not with the venue. Whether a swap is executed on a verified exchange or through a non-custodial aggregator makes no difference to how HMRC treats the disposal. It only changes who else holds a record of it.
What is Section 104 pooling?
It is the UK method for working out cost basis. Every unit of the same token you hold forms a single pool with a single average cost, rather than each purchase being tracked individually. When you dispose of part of the holding you deduct a proportional share of the pooled cost.
What are the same-day and 30-day rules?
Before touching the pool, a disposal is matched against any acquisition of the same token made on the same day, then against acquisitions in the 30 days after the disposal. Only the remainder draws on the Section 104 pool. This matters if you sell and re-buy quickly, which happens easily when rebalancing through swaps.
Is staking income or capital?
Rewards are normally taxable as income at their sterling value when you receive them, and that value becomes the acquisition cost entering your pool. Selling or swapping those tokens later is a separate capital event. Where activity amounts to a trade, different rules apply.
What records should I keep for a SwapRocket order?
The date and time, the pair, the deposit and payout amounts, the destination address, the provider that executed the order and the sterling value at the time. Your order page retains these details; save or export them, because instant exchanges do not hold an account history for you.
SwapRocket is a non-custodial exchange aggregator, not a tax adviser, accountant or regulated financial firm. Everything above describes publicly available HMRC rules as we understand them and may be out of date; rates, allowances and reporting dates change. Confirm the current position on GOV.UK or with a qualified professional before filing.