UK tax authority doubles crypto warning letters in crackdown on unpaid gains

HMRC sent nearly 65,000 warning letters to crypto investors last year, more than double the previous year, as the UK steps up efforts to trace undeclared capital gains.

The UK tax authority has ramped up its scrutiny of crypto investors, doubling the number of warning letters sent to those suspected of underreporting or evading taxes on digital asset gains.

HM Revenue & Customs (HMRC) issued nearly 65,000 letters in the 2024–25 tax year, up from 27,700 the year before, the Financial Times reported on Friday, citing data obtained under the Freedom of Information Act.

The letters, known as “nudge letters,” are designed to prompt investors to voluntarily correct their tax filings before formal investigations are launched.

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