A capital loss on crypto is not a loss until you tell HMRC about it. Section 16(2A) of the Taxation of Chargeable Gains Act 1992 says a loss “shall not be an allowable loss for the purposes of this Act unless, in relation to that year, he gives a notice to an officer of the Board quantifying the amount of that loss”. No notice, no loss — it never becomes allowable at all.
That notice has a deadline, and it is not the one in your diary. Section 16(2A) imports section 43 of the Taxes Management Act 1970, which gives four years “after the end of the year of assessment to which it relates”. So a 2022/23 loss must be notified by 5 April 2027, 2023/24 by 2028, 2024/25 by 2029, 2025/26 by 2030. Four tax years are open today, and the oldest closes 64 days after the 31 January 2027 deadline everyone has in their head.
Nothing warns you. A year of pure losses creates no chargeability, so no duty to notify arises, no notice to file is issued and no penalty accrues. The deadline that costs the most is the one with no enforcement attached.
What it is worth, and what it costs
Take a 2022/23 disposal of £28,400 against a section 104 pool cost of £46,900 — a loss of £18,500, never reported, by someone not then in Self Assessment. In 2025/26 she has gains of £9,200 on taxable income of £31,430. The allowance leaves £6,200 and her unused basic rate band is £6,270, so it all falls at 18 per cent. Notify the old loss and £6,200 of it is used, saving £1,116, with £12,300 carried forward. Miss 5 April 2027 and both are gone.
The ordering rules are asymmetric, and that is where money goes quietly. Current-year losses must come off first, deducted “even if the net chargeable gains thus fall below the annual exempt amount”; brought-forward losses are rationed the other way, “but not so as to take the net chargeable gains below” it. Realise £4,000 of gains and £3,500 of losses in one year and you have burned £2,500 of a £3,000 allowance for nothing.
A loss banked in a quiet year is worth strictly more than the same loss realised in a gain year.
How to give the notice
There is no form; the manual says so. In Self Assessment the notice goes in the return — box 13.5 for cryptoasset losses in the year, box 45 for brought-forward losses used, box 47 for losses carried forward — with the computation enclosed. If you are not in Self Assessment and have never had a gain, write to Capital Gains Tax Queries, HM Revenue and Customs, BX9 1AS: tax year, quantified loss, the pools, proof of posting. Get the route right, because section 42(2) says that once a notice to file has been issued, a claim “shall not at any time be made otherwise than by being included in a return under that section if it could, at that or any subsequent time, be made by being so included”.
Two traps. The £50,000 proceeds test makes the capital gains pages mandatory even in a loss year, and because every crypto-to-crypto swap is a disposal valued in sterling, it arrives sooner than new money invested would suggest; on a nil-tax return filed late the penalties are not tax-geared and maximum exposure is £1,600. And a negligible value claim cannot rescue the cliff: backdating reaches only two years, so a claim made now reaches 6 April 2024 and no further.
One more, for anyone defrauded. HMRC's crypto manual states flatly that “victims of theft cannot claim a loss for Capital Gains Tax” and cites no statute for it, while the Capital Gains Manual page it points to, updated more recently, says a negligible value claim “would be competent” where there is no likelihood of recovery. HMRC disagreeing with itself is a reason to take advice, not to write the loss off.
| Loss notice deadline, 2022/23 | 5 April 2027 |
| 2025/26 return and payment | 31 January 2027 |
| Annual exempt amount | £3,000, 2025/26 and 2026/27 |
| CGT rates on cryptoassets | 18% in the basic rate band, 24% above |
| Basic rate band, allowance | £37,700; £12,570 |
| Proceeds reporting threshold | £50,000 |
| Nil-tax late filing, maximum | £1,600 |
| Late payment interest | 7.75%; 8.00% from 24 November 2026 |
| Worked example | £1,116 saved and £12,300 banked, or £18,500 lost |
Statute from legislation.gov.uk: TCGA 1992 sections 16, 24 and 1K, and TMA 1970 sections 7, 42, 43, 8C and Schedule 1A, as in force on the dates those pages state. HMRC guidance: Capital Gains Manual CG15800, CG21500, CG13125, CG13155 and CG20220, all showing an update date of 9 November 2026 when we read them, and Cryptoassets Manual CRYPTO22100, 22200, 22400, 22450 and 22500, all of 28 November 2025. Rates, allowances, deadlines, penalties and interest from GOV.UK; box numbers from the SA108 summary and notes for 2025/26. Retrieved 9 and 10 November 2026. Arithmetic computed here. Contested: CG20220, refreshed this month, still states the repealed test of four times the annual exempt amount where the statute has said £50,000 since 2023/24 — the statute governs. CRYPTO22450's statement on theft cites no authority and is in tension with CG13155; both are above. The £50,000 test relaxes what must go in a return you already have to file; it does not bring a loss-only non-filer into Self Assessment. The £1,600 is a maximum exposure, not an automatic charge, and whether a loss can be notified through the real time service is not stated either way by HMRC. General information and not tax advice. Not a recommendation and not a forecast.