What Records Should I Keep for Cryptocurrency Transactions

At Towerstone, we provide specialist crypto accountancy services for UK investors and businesses. We have written this article to explain record keeping requirements, helping you understand the tax and reporting position.

This is one of the most important questions anyone involved in crypto can ask, and in my opinion it is far more important than worrying about tax rates or allowances. From experience almost every crypto tax problem I see starts with poor or incomplete records. People often focus on whether crypto is taxable, but HMRC’s real leverage comes from record keeping. If you cannot prove what happened, HMRC will make assumptions, and those assumptions are rarely in your favour.

I have worked with crypto investors, traders, business owners, directors, and people who casually dipped their toe into crypto years ago and then forgot about it. The pattern is always the same. Those who kept clear records sleep far better at night. Those who did not often end up spending significant time and money trying to reconstruct years of activity under pressure.

In this article I will explain exactly what records you should keep for cryptocurrency transactions in the UK, why each type of record matters, how long you should keep them, and what I recommend from experience to make this manageable rather than overwhelming. I will also explain the mistakes I see repeatedly and how to avoid them before HMRC ever asks a question.

Why Record Keeping Matters So Much for Crypto

From experience crypto record keeping matters more than for most other assets.

With a bank account HMRC can usually see:

Opening balances

Closing balances

Interest earned

Clear transaction descriptions

With crypto HMRC sees none of that automatically in a helpful way. Blockchain data exists, but it does not explain ownership, intent, or tax treatment. Exchanges hold data, but it is fragmented and sometimes incomplete.

In my opinion HMRC places a higher expectation on crypto users to keep their own records because the responsibility cannot be outsourced to banks or platforms.

Good records allow you to:

Calculate gains and income accurately

Defend your figures if HMRC asks questions

Correct mistakes early

Reduce penalties if errors occur

Demonstrate reasonable care

Poor records do the opposite.

The Core Principle HMRC Applies

HMRC’s expectation is simple in principle.

You must keep sufficient records to show:

What transactions took place

When they took place

What value they had in sterling

Why they were treated the way they were for tax

If you can clearly answer those four points, most crypto tax issues become manageable.

A Complete List of Records You Should Keep

From experience I recommend keeping records in several clear categories. Each category answers a different HMRC question.

Records of Every Exchange You Have Used

You should keep a list of every crypto exchange you have used, even briefly.

This includes:

Centralised exchanges

Overseas exchanges

Platforms you no longer use

Platforms that have since closed

For each exchange keep:

The name of the exchange

Your username or account reference

The period during which you used it

Copies of statements or exports

From experience people forget old exchanges and HMRC later produces data from them. That is never a good position to be in.

Full Transaction Histories From Exchanges

For each exchange you should download and keep:

Trade histories

Deposit histories

Withdrawal histories

Fee reports

Ideally these should be in CSV or similar downloadable formats.

From experience screenshots are not enough. HMRC expects raw data that can be checked and recalculated.

I always advise clients to download full histories annually even if they think they will not need them. Exchanges change, accounts get locked, and data disappears.

Wallet Addresses and Wallet Records

If you have used private wallets you must keep records showing:

Wallet addresses you control

Which blockchain each wallet relates to

When wallets were created

How funds moved in and out

This is critical for distinguishing transfers from disposals.

From experience HMRC often asks how you can prove that a transfer between wallets was not a sale. Wallet ownership evidence answers that question.

Transaction Hashes and Blockchain Evidence

For on chain transactions you should keep:

Transaction hashes

Dates and times

Block confirmations

Asset types and quantities

You do not need to print entire block explorers, but you should be able to retrieve evidence quickly if asked.

From experience blockchain evidence is powerful when combined with clear explanations.

Sterling Values at the Time of Each Transaction

This is one of the most commonly missing records.

For every taxable event you should record:

The date of the transaction

The sterling value at that date

The exchange rate source used

HMRC requires crypto transactions to be valued in sterling at the time they occur, not later.

From experience relying on today’s prices or averages causes errors.

If you use software, ensure it consistently applies exchange rates and keep a note of the source used.

Records of Fiat Movements

You should keep bank statements showing:

Fiat deposits into exchanges

Fiat withdrawals from exchanges

Links between bank accounts and exchange accounts

This helps HMRC reconcile crypto activity with known cash movements.

From experience unexplained fiat movements raise more questions than crypto movements alone.

Records of Crypto to Crypto Trades

Crypto to crypto trades are disposals for tax purposes.

You should record:

What asset was disposed of

What asset was acquired

The sterling value of the asset disposed of

Any fees paid

From experience people often track only the asset acquired and forget the disposal side. HMRC will not.

Records of Fees Paid

Transaction fees matter for tax calculations.

You should keep records of:

Trading fees

Network fees

Withdrawal fees

Fees paid in crypto

Fees can often be added to allowable costs or deducted from proceeds.

From experience missing fee data can materially distort gains and losses.

Records of Income Type Crypto

This is where many people fall down.

You should keep separate records for crypto received as income, including:

Staking rewards

Mining income

Airdrops

Referral bonuses

Payments for work

Yield or interest like rewards

For each income event record:

Date received

Asset type

Quantity

Sterling value at receipt

Reason for receipt

From experience HMRC focuses heavily on income because it is more often omitted than gains.

Records of Gifts and Transfers

If you gift crypto or receive gifts you should keep records showing:

Who the gift was to or from

The date of the gift

The sterling value at the time

Whether the recipient was a spouse or civil partner

Gifts can trigger tax or affect future calculations.

From experience undocumented gifts cause confusion years later.

Records of Losses

Losses are valuable but only if they are properly evidenced.

You should keep records showing:

When assets were disposed of

Disposal values

How losses were calculated

Evidence that disposals genuinely occurred

From experience HMRC may scrutinise loss claims more closely than gains.

Records of Software and Tools Used

If you use crypto tax software, keep:

The name of the software

Versions used

Exported reports

Notes on how transactions were categorised

Software outputs are not self explaining. HMRC will expect you to understand and explain the figures.

In my opinion software should support your records, not replace your understanding.

How to Organise Your Crypto Records

Good records are not just about what you keep, but how you keep them.

From experience the most effective approach is:

One master spreadsheet or report per tax year

Supporting folders for raw exchange data

Clear labelling of wallets and platforms

Consistent naming conventions

You want to be able to answer HMRC questions without scrambling.

If you cannot explain your records to yourself six months later, they are probably not good enough.

How Long Should You Keep Crypto Records

HMRC record retention rules apply to crypto just like any other asset.

From experience this means keeping records for at least:

Five years after the 31 January filing deadline for individuals

Six years for companies

Given HMRC’s ability to open enquiries years later, I usually recommend keeping crypto records for longer where possible.

Storage is cheap. Reconstruction is not.

Common Record Keeping Mistakes I See

Over the years I have seen the same mistakes repeatedly.

These include:

Relying on memory

Keeping only screenshots

Failing to record sterling values

Losing old exchange data

Mixing personal and business crypto

Not separating income and capital

Assuming software is always correct

Ignoring small transactions

In my opinion these mistakes usually happen gradually rather than deliberately, which is why early discipline matters.

What HMRC Looks for in a Crypto Enquiry

When HMRC reviews crypto records they usually look for:

Completeness

Consistency

Logical explanations

Clear links between data and tax returns

They are not expecting perfect formatting. They are expecting reasonable care.

From experience well organised records often shorten enquiries dramatically.

What If My Records Are Already Incomplete

This is very common and not a reason to panic.

From experience the best approach is:

Identify gaps honestly

Reconstruct data where possible

Use reasonable estimates supported by evidence

Document assumptions clearly

HMRC is far more understanding where effort and transparency are evident.

Personal Crypto Versus Company Crypto Records

If you hold crypto personally and through a company, records must be kept separately.

From experience mixing these creates serious problems including:

Director’s loan account issues

Incorrect tax treatment

HMRC suspicion of poor controls

Company crypto records should meet the same standard as any other business asset.

My Practical Recommendations From Experience

Based on everything I have seen, my practical advice is:

Download exchange data regularly

Keep everything in sterling as well as crypto units

Label wallets clearly

Separate income from investment activity

Keep records even when you think nothing is taxable

Assume HMRC may ask questions years later

In my opinion the effort required to keep good records is far lower than the effort required to fix bad ones.

Key Takeaways

So what records should you keep for cryptocurrency transactions.

The answer is more than you think, but not as much as you fear if you are organised.

From experience crypto tax problems are rarely caused by the rules themselves. They are caused by missing evidence and unclear histories. Good records turn complex activity into a straightforward compliance exercise.

If there is one message I would leave you with it is this. Crypto rewards early adopters, but HMRC rewards good record keepers. If you treat your crypto activity with the same discipline you would treat a business asset, you will save yourself stress, time, and money in the long run.

If you would like to explore related investing and crypto guidance, you may find Do I pay tax on crypto used to buy goods or services and Do I pay tax on yield farming or liquidity pool rewards useful. For broader investing context, visit our stocks and shares guidance hub.