UK Tax Authority Intensifies Crypto Tax Compliance Efforts

HM Revenue & Customs (HMRC) has escalated its crackdown on cryptocurrency tax evasion, sending 64,982 warning letters to UK investors in the 2024-2025 tax year—more than double the previous year's 27,713 notices. The so-called "nudge letters" target individuals suspected of underpaying capital gains tax on digital asset transactions.

Data obtained via Freedom of Information requests reveals a dramatic surge in enforcement activity. After sending no crypto-related tax notices in 2022-2023, HMRC's campaign has grown exponentially, with the latest figures representing a 134% year-over-year increase. Tax advisors warn the actual tax shortfall could be substantial given widespread non-compliance.

The letters serve as preliminary warnings before formal investigations. "This isn't gentle persuasion—it's a coordinated revenue recovery effort," noted one London-based tax specialist. The campaign reflects global trends as regulators worldwide tighten cryptocurrency oversight.