The days of crypto anonymity are coming to an end. From January 2026, HMRC will begin receiving automatic data on UK taxpayers’ cryptoasset activities from digital asset platforms around the globe. This is all under a new international agreement known as the Cryptoasset Reporting Framework (CARF).
This marks a big change in how crypto is taxed and tracked. Exchanges in former crypto havens like the Cayman Islands, UAE, and Switzerland must now share user identity and transaction data directly with tax authorities, including HMRC.
Who Will Be Affected?
Under the Cryptoasset Reporting Framework (CARF), the upcoming changes apply to anyone who is:
- A UK tax resident
- Holding or trading cryptoassets
- Using overseas wallets or international crypto exchanges
What Data Will Be Shared?
The information provided to HMRC will include:
- Your full name, residential address, and tax identification number (TIN)
- The types of cryptoassets you have traded or held
- Transaction dates, volumes, and market values
This level of detail will give HMRC a full view of your crypto activity. Thus, eliminating the need to ask for records or wait for voluntary disclosures.
Voluntary Disclosure Window Is Closing
If you have undeclared crypto gains, now is the time to come forward. Once HMRC receives the data from foreign exchanges, the opportunity to make a voluntary disclosure will become more limited. Individuals may then face higher penalties, interest, and even investigations under HMRC’s civil or criminal compliance programmes.
To understand how crypto is taxed and what steps to take, read our complete guide to crypto tax in the UK.
At Legend Financial, we are already advising UK crypto investors on how to:
- Regularise their crypto tax positions before 2026
- Prepare for new international reporting requirements
- Restructure or manage holdings for long-term tax efficiency
A Coordinated Global Effort
The Cryptoasset Reporting Framework is a multilateral agreement backed by the OECD and adopted by numerous participating countries. The aim is to eliminate the misuse of crypto for tax evasion and to bring transparency to digital finance.
As of now, more than 40 countries have agreed to begin automatic exchanges of crypto data by 2026. This makes it one of the most comprehensive tax transparency initiatives in recent years.
Take Action Before the Rules Take Effect
With just over a year until implementation, UK taxpayers dealing in crypto are encouraged to act now. Early engagement can help mitigate future tax risks and ensure full compliance with incoming regulations.
If you are uncertain about your crypto tax obligations, or suspect you may have undeclared gains, reach out to our specialist team. We offer confidential consultations and practical advice according to your situation.
Contact us today to schedule a confidential crypto tax review.
