How are NFTs taxed in the UK?

Full answer

There is no separate NFT tax in the UK. HMRC applies existing rules, and the treatment depends on what you do and how you do it. For most individuals who buy and later sell a non-fungible token as an investment, the disposal is a Capital Gains Tax (CGT) event. A disposal includes selling for cash or crypto, swapping one NFT for another, or gifting it to anyone other than your spouse or civil partner. Your gain is the disposal proceeds (in pound sterling at the date of disposal) minus what you paid, plus allowable costs such as gas and platform fees. For 2026/27 the CGT annual exempt amount is GBP 3,000. Gains above that are taxed at 18% to the extent they fall within your remaining basic-rate band, and 24% above it. Because NFTs are usually bought and sold using cryptocurrency, a single NFT trade can trigger two taxable events: disposing of the crypto used to pay, and later disposing of the NFT itself. Both need to be calculated in sterling. A worked example: you buy an NFT for GBP 4,000 and sell it for GBP 12,000, with GBP 500 of fees. Your gain is GBP 7,500. After the GBP 3,000 exemption, GBP 4,500 is taxable - at 18% that is GBP 810, at 24% it is GBP 1,080, depending on your income. Different rules apply in two situations. If you trade NFTs so frequently and systematically that it amounts to a trade, HMRC may tax your profits as income (income tax plus National Insurance) rather than CGT. And if you create and sell your own NFTs, that is generally self-employment income, taxed under income tax with the GBP 1,000 trading allowance potentially available. Keep detailed records of dates, sterling values and fees for every transaction. Use the capital gains tax calculator for investment disposals and the self-employed tax calculator if you create or trade NFTs as a business.

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