In the new budget, the UK government confirmed the introduction of new regulations requiring cryptocurrency exchanges to collect and report detailed personal data of their customers. The regulations will enter into force on January 1, 2026.
Cryptoasset Reporting Framework – what will change?
The new rules result from an international agreement with the OECD known as the Cryptoasset Reporting Framework. Under the arrangement, UK-registered trading platforms will have to report information about their users’ cryptocurrency transactions along with their tax identification numbers to the UK tax office HMRC. The first data collected from January 2026 will be sent to HMRC in 2027.
Investors who refuse to provide the required information to stock exchanges can be fined up to £300 (approximately PLN 1,600). Trading platforms will also face financial consequences – up to £300 for each unreported customer. HMRC will use the collected data to verify the accuracy of tax returns submitted and identify people who have not reported cryptocurrency profits.
Hundreds of millions for the British budget
The UK Tax Office estimates it will collect an additional £315 million (about $417 million) in taxes by April 2030 under the new rules. As noted by Jonathan Athow, director general of HMRC, the new framework does not introduce a new tax on cryptocurrency investments, but only ensures better compliance with existing capital gains tax.
Challenges for stock exchanges and investors
Experts point out the challenges associated with implementing the new requirements. Dion Seymour, director of cryptocurrencies and digital assets at the London law firm Andersen, emphasizes that cryptocurrency users are often reluctant to share their personal data, which may make it difficult for platforms to collect all the required information. Exchanges will also have to implement appropriate systems to record and report customer data.
Failure by platforms to fulfill their obligations may result in severe penalties for lack of due diligence, late or inaccurate reporting, incorrect documentation or failure to register reportable users. Penalties may be imposed for each unreported user, which may lead to significant financial penalties.
David Lesperance of Lesperance and Associates predicts two consequences of the new regulations. First, some traders may move to platforms that do not comply with reporting requirements, similar to what has happened in the world of banking and brokerages. Second, there will eventually be international harmonization of cryptocurrency reporting standards, forcing most countries to implement similar regulations.
Additional compliance costs are likely to be passed on by exchanges to their clients, which could impact the popularity of UK trading platforms.
What about DeFi taxation?
In the same budget, HMRC also published a summary of its consultation on the taxation of DeFi lending and staking activities. The British government is leaning towards an approach that would recognize taxable events only when profits are actually realized, i.e. the sale of cryptocurrencies for fiat currency. The final decision on this matter has not been made yet.
