Can I claim a crypto loss against income tax?

No. Crypto losses are capital losses only — they offset capital gains, not income. The exception is if you can demonstrate you were trading crypto as a business under HMRC's badges-of-trade test, which is rarely accepted for retail investors.

How long do I have to claim a crypto loss?

Four years from the end of the tax year in which the loss arose. So a loss in 2025/26 must be registered with HMRC by 5 April 2030. After that the loss is permanently lost.

What if my crypto went to zero (FTX, Celsius, dead memecoin)?

Use a 'negligible value claim' — Form CG34 or just on the Self Assessment. You don't need to actually sell to claim. HMRC accepts that the asset is worthless if you can show the project is dead, the exchange is in liquidation, or you can't access the wallet.

Can I carry losses forward forever?

Yes — once registered, capital losses carry forward indefinitely until offset against future gains. They must be registered within the 4-year window though, or they're lost.

Updated 26 April 2026 · 7 min read

How to Claim a Crypto Loss in the UK (2025/26)

Lost money on crypto? You can offset those losses against capital gains for years to come — but only if you register them with HMRC properly within the 4-year window. Here’s exactly how.

Why register a loss?

Capital losses can be:

Offset against this year’s gains before the £3,000 AEA is applied
Carried forward indefinitely against future capital gains (any asset class — property, shares, crypto)
Used only against capital gains — not against income tax (very rare exceptions for trade-business activity)

If you don’t register a loss within 4 years of the end of the tax year it arose in, it’s permanently lost.

When does a crypto loss happen?

HMRC recognises a capital loss when there’s a CGT-disposal at a value lower than the cost basis. Common triggers:

You sold for fiat at less than your Section 104 pool average
You swapped token A for token B and the GBP value of B at the swap was less than your cost basis in A
You spent crypto on goods/services at a price below your cost basis
You gifted to anyone other than your spouse, where the market value at gift was below cost basis
The asset became worthless — see negligible value claim below

Just having a position drop in price isn’t a loss — it’s an unrealised loss. You need an actual disposal.

Negligible value claims

If your crypto is genuinely worthless (FTX claims, Luna v1, dead memecoin, lost wallet with verifiable proof), you can make a Negligible Value Claim without actually selling.

For HMRC to accept it, you need to show:

The asset still exists in your beneficial ownership
Its current market value is negligible (effectively zero)
The drop to negligible value happened during your ownership

The deemed disposal date is whatever date you nominate (within 2 years before the claim).

How to file: tick the “Capital loss / negligible value” box on the SA108 and include details in the additional information section. For complex cases, file Form CG34 separately.

Worked example — FTX collapse:

You held 50,000 FTT on FTX. Cost basis (Section 104 avg): £25,000. FTX collapses Nov 2022. You can’t access the position.

For the 2022/23 SA108: nominate 14 November 2022 as disposal date, deemed proceeds £0, allowable cost £25,000. Loss: £25,000.

Once registered, that £25,000 loss carries forward forever until offset against future gains. If you make £30,000 of gains in 2027, you only owe CGT on £5,000 (after using the £25k loss).

Reporting losses you can’t use this year

If your losses exceed your gains, the excess carries forward. You still need to register them with HMRC in the year they arose:

File the SA108 for the year of the loss, even if you don’t have gains to offset
OR write to HMRC separately within 4 years registering the loss
Note the loss amount on subsequent years’ SA108s under “losses brought forward”

Common mistakes

Letting the 4-year window expire. Losses from 2021/22 must be registered by 5 April 2026 — after that, gone.
Forgetting the 30-day rule when harvesting. Selling at a loss and rebuying within 30 days nullifies the loss for tax purposes (HMRC matches the sale to the rebuy at the rebuy price).
Trying to claim against income tax. Crypto capital losses don’t reduce salary income tax. Special rules for share losses do (s131 ITA 2007), but they don’t apply to crypto.
Losing your records. If HMRC queries a loss claim 4 years later, you need to evidence the cost basis. Keep wallet addresses, dates, GBP values.