Does HMRC Know About My Crypto? CARF, Exchange Data and 2027

Yes — in most cases HMRC either already knows about your crypto or soon will. UK exchanges have shared customer data with HMRC for several years, and under the Cryptoasset Reporting Framework (CARF) every UK crypto platform has been collecting users' identity and tax details since 1 January 2026, with the first annual reports due to HMRC between 1 January and 31 May 2027. Platforms in dozens of other countries will report UK residents' activity to HMRC through the same system. That data is what sits behind the 81,172 "nudge" letters, emails and texts HMRC sent to crypto holders in 2025/26.

This guide explains what HMRC can see, how CARF works, what you have to give your exchange, and what to do if you think you have something to declare — for 2025/26 the return is due 31 January 2027.

Can HMRC track crypto?

HMRC cannot read private wallets, but it does not need to. It receives customer and transaction data from UK exchanges, it can require UK crypto businesses to provide information about their customers, and from 2027 it will get annual reports on UK residents from platforms in every country that has signed up to CARF. Most people buy crypto through an exchange that has verified their identity and is linked to a UK bank account, so activity on the blockchain can be tied back to a named person.

HMRC's guidance is explicit about the purpose. GOV.UK says the information you give a platform "is used to link your cryptoasset activity to your tax record", which "makes it easier for us to find out what tax you need to pay". It is not a threat; it is how the system is designed to work.

What is the Cryptoasset Reporting Framework (CARF)?

CARF is an international standard developed through the OECD under which crypto platforms collect identity and transaction data on their users and report it annually to their national tax authority, which then exchanges it with other participating countries. The UK brought CARF into force from 1 January 2026 through the Reporting Cryptoasset Service Providers (Due Diligence and Reporting Requirements) Regulations 2025.

Under the UK rules, every "reporting cryptoasset service provider" (RCASP) based in the UK — exchanges, brokers, dealers and other businesses that transact crypto for users or give users a way to transact — must:

• carry out due diligence on all individual and entity users from 1 January 2026;
• collect transaction data (value, type of cryptoasset, type of transaction and number of units) for users resident in the UK and in other CARF countries;
• register with HMRC's online service and tell users their details will be reported by 31 January 2027; and
• submit their first report, covering 2026, between 1 January and 31 May 2027, and annually after that.

HMRC's Cryptoassets Manual (CRYPTO49000) confirms the reporting obligation covers customers resident in the UK and customers resident in countries on HMRC's list of CARF jurisdictions.

What details do I have to give my exchange?

If you are an individual, you must give every cryptoasset service provider you use — including those based outside the UK — your full name, date of birth, the address and country where you normally live, and your tax identification number, which for UK residents is your National Insurance number or Unique Taxpayer Reference (UTR). Companies, partnerships, trusts and charities must give their legal name, main business address and, for UK companies, their company registration number.

You must give accurate details. GOV.UK states that if you give inaccurate details or do not give details to a UK service provider, "you could get a penalty of up to £300", and the penalty could be higher for non-UK providers. Regulation 13 of the 2025 Regulations sets the £300 maximum for a deliberate failure or one caused by not taking reasonable care. A platform can also refuse to keep serving you if you do not comply.

Which crypto exchanges report to HMRC?

All UK-based exchanges, brokers and dealers must report. A business counts as UK-based if it is UK tax resident, incorporated in the UK, managed in the UK, or has a regular place of business or branch here. Where a platform is based in more than one CARF country, it reports in the one highest on the "nexus" hierarchy, with tax residence at the top — so a platform tax resident in France but incorporated in the UK reports to France, which shares the data with HMRC.

Non-UK platforms in CARF countries report UK residents' data to their own tax authority, which exchanges it with HMRC. Accountancy firm UHY Hacker Young, which obtained HMRC's nudge letter figures under the Freedom of Information Act, says HMRC will start receiving data on UK residents from exchanges in 52 jurisdictions from 31 May 2027, with a further 15 following in 2028. You can check which countries have signed up on the OECD's list of CARF signatories, linked from GOV.UK.

What does HMRC already know from UK exchanges?

Plenty. Before CARF, HMRC could — and did — request customer data from UK exchanges, and it has used that data to write to people whose returns did not appear to match their crypto activity. Freedom of Information figures obtained by UHY Hacker Young show the scale:

The 2025/26 figure was reported by the BBC on 19 August 2026. HMRC told the BBC: "We regularly send letters to educate, remind or prompt customers to review their tax affairs, including customers who use crypto assets." HMRC has also added cryptoassets to its published list of genuine contacts, confirming that it may contact you "by letter, email or text message" if you have traded in cryptoassets, with links to guidance on checking you have declared correctly.

In other words, the letters are not random. They go to people HMRC's data suggests have something to check.

What will change in 2027?

From 2027 HMRC will receive structured annual reports rather than relying on ad hoc requests, and those reports will cover overseas platforms as well as UK ones. The first CARF reports, covering activity in calendar year 2026, arrive between 1 January and 31 May 2027. From then on HMRC can compare what platforms report against what appears on Self Assessment returns automatically.

CARF only covers activity from 2026 onwards, but that does not mean earlier years are invisible. Platforms keep historic records, HMRC already holds data from UK exchanges going back several years, and a large 2026 balance with no matching history on your tax record is itself a prompt for questions. The BBC reported that HMRC believes there are still "large amounts of unpaid capital gains" from the rise in crypto values between December 2022 and October 2025.

Does using an overseas exchange or a hardware wallet keep me off HMRC's radar?

No, and it does not change what you owe. UK residents are taxed on their worldwide gains and income, so a trade on an overseas exchange is just as taxable as one on a UK platform. Overseas exchanges in CARF countries will report you to HMRC via their own tax authority, and the funds usually enter or leave through a UK bank account that HMRC can see.

Self-custody does not change the analysis either. Moving coins to a hardware wallet is not itself taxable, but the exchange you bought them from has recorded the purchase and the withdrawal, and anything you eventually sell or swap is a disposal. HMRC's record-keeping guidance (CRYPTO10400) expects you to keep wallet addresses and bank statements as part of your audit trail.

What if I have crypto I have not declared?

Work out what you owe and put it right. For the current or previous tax year, include the gains or income on your Self Assessment return — for 2025/26, that return is due by 31 January 2027. For earlier years, use HMRC's Cryptoasset Disclosure Service, which lets you disclose voluntarily, pay the tax and interest, and settle any penalty online.

Coming forward before HMRC contacts you generally means lower penalties than waiting to be prompted, and GOV.UK notes that if you do not declare and HMRC finds out, the penalty can be up to 100% of the tax due plus interest. The Cryptoasset Disclosure Service guide explains how many years you need to go back and how the penalty ranges work.

Start by calculating your gains for each year, using HMRC's pooling rules. Our calculator runs in your browser — your files never leave your device — and shows exactly which rule applied to each disposal.

What if HMRC has already written to me?

Do not ignore it, and do not panic either. A nudge letter asks you to review your crypto activity and correct anything missing by the date printed on it. Check the letter is genuine against GOV.UK's list of genuine HMRC contacts (HMRC will not ask for bank details by email or text), gather your exchange exports, work out your position for the years in question, and reply as the letter instructs — even if you conclude nothing is owed.

Our letter helper walks through the questions to ask, which years to calculate and which route (Self Assessment, the real time service or the disclosure service) fits your situation.

Sources

• Information you need to give to UK cryptoasset service providers — GOV.UK
• Check if you need to report cryptoasset data to HMRC — GOV.UK
• Collecting cryptoasset user and transaction data — GOV.UK
• CRYPTO49000 — The Cryptoasset Reporting Framework — HMRC Cryptoassets Manual
• The Reporting Cryptoasset Service Providers (Due Diligence and Reporting Requirements) Regulations 2025, regulation 13 — legislation.gov.uk
• Check genuine HMRC contact that uses more than one communication method — GOV.UK
• Check if you need to pay tax when you sell cryptoassets — GOV.UK
• Tell HMRC about unpaid tax on cryptoassets — GOV.UK
• CRYPTO10400 — Record keeping — HMRC Cryptoassets Manual
• 81,000 warning letters sent to crypto holders in HMRC tax crackdown — BBC News, 19 August 2026
• Cryptocurrency investors under increased pressure from HMRC investigations — UHY Hacker Young, 20 August 2026
• HMRC sending 65,000 letters to UK households as they 'step up' pursuit — Chronicle Live, 20 October 2025 (UHY Hacker Young FOI data)