Invest3 publishers3 min readPublished Updated
240 filers booked half of Britain's £1.38bn of declared crypto gains
The first year with a crypto box on the Self Assessment return shows a base narrow enough to fit in one room. That changes both what a rate rise would collect and what the 2027 exchange data feed is worth chasing.
The Investor · Invest desk
What happened
- HMRC broke cryptoasset gains out of the general capital gains figures for the first time, covering 2024-25, the first year the Self Assessment return carried a dedicated crypto disposals section.
- Some 17,600 individuals declared £13.8bn of crypto disposal proceeds and £1.38bn of taxable gains for the year, an average gain of £78,000 per filer.
- A cluster of 240 filers each cleared more than £1m of crypto gains, and between them they took £717m of the total.
- The 65% of crypto taxpayers who reported gains under £25,000 accounted for just 7% of the gains and 8% of the disposal proceeds.
- HMRC sent 81,000 nudge letters to suspected underpayers over the past year, up 25% on about 65,000, and from 31 May 2027 expects automatic reports on UK residents from exchanges in 52 jurisdictions.
Compiled by The InvestorSomething wrong?How this is made
Why it matters
- constraint With 51.96% of the declared yield sitting on 240 identifiable returns, any change to the crypto CGT rate is priced off a cohort small enough that individual departures move the revenue line.
- decision HMRC now has to choose whether the incoming provider data is worked as a volume campaign against four-figure liabilities or as a reconciliation exercise on the filers who already hold the money.
- exposure Once provider reporting is automatic, the disclosure window for non-filers stops depending on whether a letter arrives and starts closing on a calendar date set outside HMRC.
- precedent A first official profile that is overwhelmingly male and mostly under 55 hands future crypto tax proposals a distributional argument that has nothing to do with how much revenue is at stake.
The conversion rate is where this data earns its keep. £13.8bn of disposals produced £1.38bn of taxable gains [2], a margin of 10.0% [1], which means roughly £12.42bn of that gross flow was cost basis coming back out again [2], and since swapping one cryptoasset for another is itself a disposal [14], some unknown slice of the £13.8bn never touched sterling.
Split it by age and the spread widens. The 25 to 44 band supplied 71% of proceeds and kept 45% of the gains [6], which works out at a 6.3% margin against 19.0% for everyone 45 and over [8][9], so the group doing most of the volume converts at about a third of the older group's rate [10]. Men were 87% of filers and took 93% of the gains [8].
Below the millionaires the distribution is unremarkable. Strip out the 240 and the remaining 17,360 filers shared £663m, or £38,190 each [6], against £2.9875m each at the top [5], a gap of 78 to one [7]. The 65% reporting under £25,000 come to about 11,440 people [11] holding £96.6m of gains between them, £8,444 apiece [12]. And because HMRC puts more than half of the proceeds with the same 240 [4], their own conversion margin is at most 10.4% [15], so what separates them is size rather than edge.
That is the figure that should govern enforcement design, and does not appear to. The 81,000 nudge letters sent in the past year, on UHY Hacker Young's count [9], outnumber the people who actually filed a crypto disposal by 4.6 to one [13], and letter volume has gone from 27,714 in 2023-24 [10] to 81,000, a 2.9-fold rise in two years [14]. Every one of those letters is officer time not spent reconciling the 240 returns that hold half the money.
This is probably wrong, but the provider data HMRC expects in 2027 [11] looks likelier to surface a very large number of four-figure liabilities than a second cohort of millionaires, and four-figure liabilities are expensive to collect one at a time. The counter-thesis, which is roughly what Neela Chauhan of UHY Hacker Young means when she says investigations will be "like shooting fish in a barrel" once the data lands [13], is that the declared distribution measures who knew to fill in the new box rather than who made the money, and the missing middle sits offshore where a 2024-25 return could not reach it.
Two results would break my read. If the 2027 provider data shows undeclared gains averaging anything close to the £78,000 mean of declared filers [2] rather than the tail's £8,444 [12], the volume campaign is aimed correctly and the arithmetic above is a distraction. And if roughly 240 millionaire filers turn up again next year, HMRC is taxing a standing base rather than one cycle's exits, or rather, the more interesting version of that: a standing base of 240 people who can change residence faster than the Treasury can rewrite a rate.
What to watch
- Whether HMRC publishes disposal proceeds for the 240 millionaire filers, which would fix their conversion margin instead of leaving it bounded at 10.4%.
- The 31 January 2027 payment deadline for 2025-26 gains, the last fully self-declared year before provider reporting begins.
- Whether the 15 further jurisdictions joining in 2028 cover the venues the declared middle of the distribution is currently missing from.