1. A salary, one sale, and the 18% slice
A person has employment income of £42,000 in 2026/27 and no other income. The personal allowance is £12,570, so taxable income is £29,430. The UK basic rate band is £37,700 wide, which leaves £8,270 of band unused. They sell a holding of tokens. The pooled allowable cost of the units sold is £14,800, disposal fees are £40, and the sterling proceeds are £22,400.
- Allowable costs: £14,840.
- Gain: £22,400 minus £14,840 = £7,560.
- Annual exempt amount: £3,000.
- Taxable gain: £4,560.
- The whole £4,560 fits inside the unused band of £8,270.
- Capital Gains Tax at 18%: £820.80.
Nothing in the example is taxed at 24%, because the gain never crosses the band. If the same person had taxable income of £40,000 already, the unused band would be nil and the £4,560 would be at 24%, which is £1,094.40. Same tokens. Different income. Different tax.
2. A swap, then a sale of what you received
The same person, in a different year with the same income, swaps Token A for Token B when Token A’s pooled cost for the units swapped is £9,000 and Token B is worth £11,400 sterling. That swap is a disposal of Token A.
- Gain on Token A: £2,400.
- Token B is acquired for £11,400, the same sterling figure used as proceeds.
Later they sell Token B for £12,100. The gain on Token B is £700. Total gains are £3,100. After the £3,000 exempt amount, the taxable gain is £100, taxed at 18% on these income figures, which is £18. The swap was the larger event. People who record only the final sale for pounds miss the £2,400.
3. A staking reward, then a sale
A person who is not running a trade receives staking rewards. On the days they arrive, the sterling values add up to £640. Assuming the receipt is miscellaneous income and no expense is deductible on these facts, £640 is income. It is not a capital gain yet.
They later sell those reward tokens for £910. The acquisition cost is the £640 already brought into income. The gain is £270. If this is their only gain and their disposal proceeds for the year are under £50,000, the gain sits inside the £3,000 exempt amount. The income of £640 is still a real receipt. Whether it has to be reported depends on the rest of their tax position, including whether they are already in Self Assessment. The exempt amount for gains does not cover the income.
4. Proceeds above £50,000, tax of nil
Another person makes many small disposals. After allowable costs, the gains are £1,200 and there are no losses. The total disposal proceeds are £62,000. The gains are under the exempt amount, so there is no Capital Gains Tax on these figures. The proceeds are over £50,000, so the disposals are still reportable. Typing nothing, because the tax is nil, does not meet that test.
5. Selling and buying back inside 30 days
A person holds a pool of 10 units of one fungible token with a pooled cost of £10,000, so £1,000 a unit. On 1 June they sell 2 units for £3,000. On 10 June they buy 2 units back for £2,200. No other acquisition happens on 1 June.
The same-day rule has nothing to match. The 30-day rule matches the 1 June sale to the 10 June purchase. The gain is proceeds £3,000 minus the matched cost £2,200, which is £800. It is not proceeds £3,000 minus the old pool cost of £2,000. The original pool of the remaining 8 units is undisturbed by that match, and the new units have been used up by the matching. A reader who “harvests” the exempt amount and restocks inside the month has often computed a gain the statute does not recognise.
What these examples leave out
They leave out losses brought forward, the personal-allowance taper, dividends, savings income, trading allowances, National Insurance on a trade, gifts to a spouse, charity gifts, DeFi beneficial-ownership questions, and any fee that was paid in a third token. Adding any one of those can move the sterling result. The illustration calculator will reproduce the shape of example 1 if you type the proceeds, the costs and the taxable income. It will not reproduce example 5, because it cannot see the dates.
