The UK could be missing out on billions in tax revenue from crypto investors, with research focused on Norwegian tax returns suggesting that a large number of crypto investors owe taxes. The report shows that 88% of all Norwegian crypto investors fail to declare their holdings, with each tax-avoiding investor owing on average between £151 to £821. Across the 6% of Norway’s population who hold crypto, this adds up to between £38m and £200m. The proportion of the UK population holding crypto is also around 6% and if the rate of unpaid tax is similar, it equates to between £500m and £2.5bn of lost revenue for HMRC. While the proportion of people in the UK failing to report investments is unknown, HMRC has said that non-compliance could range from 55% to 95%. Crypto investors are required to pay capital gains tax on any profits higher than £3,000. In cases where HMRC considers the investments to be trading, they can also be subject to income tax and National Insurance.
