Most crypto investors spend the year focused on markets, allocations, and long-term conviction. Tax tends to become a priority much later, often when the filing deadline is approaching and the position is already fixed.
The reality is that most meaningful tax planning happens in the closing months of the tax year, when most of your tax position is already visible but you still have time to make some changes.
Good year-end tax planning is not about aggressive tactics or clever schemes. It is about clarity, timing, and making deliberate decisions while options remain open.
Below are five practical steps we recommend reviewing before the end of the tax year if you want to reduce unnecessary tax and enter the new year with confidence.
Contents
- 1. Get your crypto tax software up to date
- 2. Review and use your annual CGT exemption
- 3. Consider loss harvesting carefully
- 4. Check your spouse’s tax position
- 5. Review historic capital losses before they expire
- Final thoughts
1. Get Your Crypto Tax Software Up to Date
Everything starts with visibility.
Until your crypto tax software is fully updated, you do not know:
- What gains or losses you have already crystallised this year
- Whether your annual CGT exemption has been partially or fully used
- What flexibility you still have on unrealised positions
Without this information, any planning becomes guesswork. Missing data, unmatched transfers, or incorrectly classified transactions can distort the picture and lead to decisions that are either ineffective or counterproductive.
If you are using crypto tax software such as Koinly, this is the time to ensure:
- All exchanges and wallets are connected
- Internal transfers are correctly matched
- Transactions are properly classified, including staking, gifts and airdrops
- Errors and warnings are reviewed and resolved
- Data goes back to your first crypto transaction
Once your records are accurate, you can see which gains are already locked in and what room you still have to manoeuvre before 5 April. Planning without reliable numbers rarely ends well, so this is always the first step.
2. Review and Use Your Annual CGT Exemption
For 2025/26, the Capital Gains Tax annual exemption is £3,000. This means you can realise net gains of up to £3,000 in the tax year without paying Capital Gains Tax.
The exemption cannot be carried forward. If it is unused by 5 April, it is lost.
Once you know your realised gains and losses for the tax year so far, you can assess whether you have:
- Already used your exemption
- Partially used it
- Not used it at all
If your net gains are below £3,000, it may be worth considering whether to crystallise additional gains to use the exemption fully. Conversely, if you are already in a net loss position, those in-year losses will be offset against gains first, meaning the exemption may go unused unless planning is done carefully.
Where assets are sold as part of this review, it is important to understand the 30-day matching rules. Repurchasing the same asset within 30 days can change the tax outcome under the share matching rules, so transactions should be considered in context rather than executed mechanically.
3. Consider Loss Harvesting Carefully
If you have realised gains earlier in the tax year and are facing a Capital Gains Tax liability, it may be worth reviewing whether you are holding assets at an unrealised loss.
By disposing of assets that have fallen in value, you can crystallise a capital loss and offset it against gains realised earlier in the year. Near the end of the tax year, when your overall position is clearer, this can be particularly effective.
However, loss harvesting should not be approached in isolation. It is possible to create a net loss position that wastes the annual exemption, or to alter your portfolio exposure in a way that does not align with your investment strategy.
Some investors are concerned about losing exposure if they dispose of an asset at a loss and the price subsequently recovers. Because of the 30-day matching rules, buying back the same asset too quickly may not achieve the intended tax outcome.
There are structured approaches that may allow exposure to be retained while managing the tax position, depending on circumstances. These can include transferring exposure between spouses (known as the bed and spouse strategy) or re-establishing exposure within a tax-efficient wrapper using non-crypto instruments (known as the bed and ISA strategy). These strategies require careful consideration before being implemented.
4. Check Your Spouse’s Tax Position
Transfers between spouses are generally made on a no gain, no loss basis for Capital Gains Tax. This creates planning opportunities that are often overlooked.
Before the tax year ends, it is worth reviewing:
- Whether your spouse has unused CGT exemption
- Whether they have capital losses that you do not
- Whether they are in a lower Capital Gains Tax band
In many cases, adjusting ownership between spouses before a disposal can reduce the overall household tax liability, particularly where exemptions or tax bands are unevenly used.
5. Review Historic Capital Losses Before They Expire
Capital losses must generally be claimed within four years of the end of the tax year in which they arose, if you were not otherwise required to submit a tax return. Once claimed, those losses can be carried forward indefinitely and used against future gains.
We regularly see investors who experienced significant losses in earlier market downturns and did not formally claim them at the time. Those losses can become valuable when portfolios return to profit.
For 2025/26, this means reviewing whether any losses arising in the 2021/22 tax year still need to be claimed before 5 April 2026. If they are not claimed within the time limit, they are lost permanently.
Up-to-date software reports can help quantify and evidence those historic losses, but they still need to be reported correctly to HMRC.
Final thoughts
Year-end tax planning is not about chasing marginal gains or reacting emotionally to markets. Done properly, it can make a material difference to the amount of tax ultimately paid and how efficiently allowances are used.
It also provides something many investors overlook: visibility. By reviewing your position before 5 April, you are not only shaping the outcome for the current tax year, you are also gaining a clear indication of the likely tax liability that will fall due the following 31 January. That level of foresight can make cash flow planning significantly easier and reduce the risk of an unexpected liability nine months later.
Because crypto portfolios often involve multiple exchanges, high transaction volumes, and complex matching rules, effective planning usually requires more than a quick review of headline gains. A structured review, carried out before the year closes, allows decisions to be made deliberately rather than retrospectively.
If you want confidence that your allowances are being used properly and that your year-end position reflects both your tax and investment objectives, our crypto tax planning service is designed to support a structured year-end review and help you act on the right opportunities before 5 April.
