CryptoTax UK · Guide
NFT tax in the UK — what you need to know
Non-fungible tokens (NFTs) are treated as chargeable assets by HMRC for most UK individual taxpayers. Whether you collect, create or trade NFTs, there may be a tax implication. This page summarises the main rules. Educational only — not tax advice.
Estimate my crypto and NFT tax →Selling NFTs — Capital Gains Tax
When you sell an NFT for more than you paid for it, the gain is typically subject to Capital Gains Tax. The cost basis is what you paid to acquire the NFT (including gas fees as an allowable cost). The disposal proceeds are the GBP value received at the time of sale. The same rules apply whether you sell for fiat, ETH, or any other crypto — in each case you use the GBP value at the time.
Creating and selling NFTs — possible Income Tax
If you create NFTs as part of a trade or business (e.g. a digital artist selling their work), profits from sales may be subject to Income Tax and National Insurance as self-employment income rather than CGT. The distinction between a capital disposal and a trading receipt depends on the facts — frequency, organisation, and whether the activity amounts to a trade are all relevant.
NFT royalties
Ongoing royalties from NFT sales (where a secondary market royalty is paid back to the original creator) are typically treated as income and subject to Income Tax. Keep records of every royalty payment received, including the GBP value on the date of receipt.
Buying NFTs with crypto
Paying for an NFT with ETH (or any other crypto) is a disposal of that crypto — triggering a CGT event on the crypto used. The proceeds of the crypto disposal are the GBP value of the NFT received. This is the same treatment as any other crypto-to-asset exchange.
Frequently asked questions
Are NFTs subject to the same CGT rates as crypto?
Yes — NFTs are chargeable assets for CGT purposes, taxed at 18% (basic rate) or 24% (higher rate) for 2024/25 and 2025/26, after the £3,000 annual exempt amount.
What if my NFT is now worthless?
You may be able to make a negligible value claim to HMRC if an NFT has become effectively worthless, crystallising a capital loss. The claim must be made within 4 years of the relevant tax year.
Do I pool NFTs like fungible crypto?
No — Section 104 pooling applies to fungible assets. Each NFT is a unique asset with its own cost basis and disposal proceeds. You track each NFT individually.
What records should I keep for NFT tax?
Keep: date and GBP cost of every NFT purchase (including gas), date and GBP proceeds of every sale, any royalties received with their GBP values and dates, and confirmation that on-chain transfers are between your own wallets and not disposals.
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Estimate my crypto and NFT tax →Educational guidance only. CryptoTax UK is not a regulated tax adviser and the information above does not constitute tax, legal or financial advice. Always confirm your specific position with HMRC or a qualified accountant before filing.