Check if you need to pay tax when you receive cryptoassets
Find out if you need to pay Income Tax and National Insurance contributions when you receive cryptoassets (known as cryptocurrency or bitcoin) from employment or mining.
Any cryptoasset exchange tokens (known as cryptocurrency) you receive from employment or mining count as income.
If you receive tokens as income, you鈥檒l need to keep records and may need to pay:
- Income Tax
- National Insurance contributions
You do not need to pay tax on tokens when you buy them, but you may need to pay tax when you sell them.
If you receive tokens from mining
If you receive tokens from mining and are not trading, the tokens will be treated as other taxable income.
You鈥檒l need to complete a Self Assessment tax return in pound sterling unless you鈥檝e received:
- cryptoassets worth less than 拢1,000
- less than 拢2,500 from other untaxed income
If an employer pays you tokens
Check if the tokens you鈥檙e paid are classed as readily convertible assets (an asset that can be easily exchanged for cash).
If your income is a readily convertible asset
UK employers must pay your Income Tax and National Insurance contributions through PAYE before they pay you.
If they pay you in tokens, they鈥檒l estimate the value of them, and pay Income Tax and National Insurance contributions based on the estimate. They鈥檒l then deduct tax and contributions from other wages you receive in that period.
Your employer will pay Income Tax on your behalf if either:
- you鈥檙e paid in tokens only
- they cannot deduct the full amount from your other wages
If they pay tax on your behalf, you should reimburse them within 90 days of the end of the tax year.
If your income is not a readily convertible asset
Ask your employer if they鈥檝e paid your Income Tax through PAYE. If they have not, you鈥檒l need to pay it yourself.
To pay your own Income Tax, complete a Self Assessment tax return in pound sterling.
Records you must keep
You must keep separate records for the tokens you receive, including:
- type of tokens
- date you received them
- number of tokens you received
- number of tokens you have in total
- value in pound sterling
- bank statements
- the date you disposed of the tokens
You may also want to keep other records such as wallet addresses.
HMRC might ask to see your records if they carry out a compliance check.
Read the policy
More information is available on cryptoassets for individuals.