What is crypto reconciliation?
It is the step before any tax is calculated. Every exchange export, wallet history and on-chain transaction goes into one ledger. Every acquisition gets a cost in pounds, every move between your own wallets is marked as a transfer rather than a sale, and every reward or airdrop is classified before a single gain is worked out. HMRC’s own manual says there is no disposal when you move tokens between addresses you control, at CRYPTO22100, so a ledger that treats those moves as sales is wrong before it starts.
Once the ledger is complete the UK rules are applied to it. Each type of token sits in its own section 104 pool with one pooled cost, under TCGA 1992 section 104 and HMRC’s pooling guidance at CRYPTO22200, with the same day and 30 day matching rules taking priority over the pool. Get the ledger wrong and every number after it is wrong too. The filing is the easy part.
Get a reconciliation quoteWhat we reconcile
- ✓Exchange exports from Binance, Coinbase, Kraken, Bybit, Crypto.com and more than 40 others
- ✓On-chain wallet activity across Ethereum, Bitcoin, Solana and the EVM layer 2 chains
- ✓Wallet to wallet transfers matched so they are never taxed as disposals
- ✓Missing cost basis rebuilt from historic price data and the chain itself
- ✓DeFi positions, from liquidity pools and lending to wrapping and bridging, each under the HMRC treatment set out in our DeFi tax guide
- ✓Trading bot and high volume histories, where one year can run to tens of thousands of rows, covered in our guide to trading bot taxes
- ✓Software reports reviewed, corrected and reconciled before filing
Why does crypto tax software get UK reconciliation wrong?
Crypto tax software is a good data aggregator and a poor reconciler, because its matching runs on rules that guess. When the guess is wrong the gain is overstated and you overpay, and the report looks finished either way. These are the three errors we correct most often.
Missing cost basis
Coins that arrive in a wallet without a purchase record are taxed on the whole sale price, because the software has nothing to deduct. The gain is overstated by the full original cost, which can double the bill on that coin.
Transfers seen as sales
Moving your own coins between your own wallets is not a taxable event, per HMRC at CRYPTO22100. Left unmatched, the software logs the withdrawal as a disposal at market value and invents a gain that never happened. Our guide to moving crypto between wallets shows how to spot it in a report.
FIFO instead of pooling
Default first in first out is wrong for UK tax. HMRC requires section 104 pooling with the same day and 30 day rules applied first, set out at CRYPTO22200. A report left on FIFO matches the wrong cost to every disposal in a volatile year.
Fees go wrong too. HMRC accepts a swap fee split equally between the coin sold and the coin bought, at CRYPTO22150, and most reports either drop the fee or deduct it twice. Where the original report contains errors, reconciling the transfers and rebuilding the cost basis can cut thousands of pounds from an overstated gain. That is getting the number right before you file, and it is the same work HMRC expects you to have done anyway. Our review of where UK crypto tax software breaks goes through the weak points tool by tool.
How does a transfer become a phantom gain?
Take 12 ETH bought on an exchange at £1,900 each, £22,800 in total. Eight months later, with ETH at £2,600, you move all 12 to a hardware wallet for safekeeping. Nothing has been sold, and HMRC agrees nothing has been sold, because there is no disposal while you keep beneficial ownership. Here is what an unmatched software report does with those rows.
| Row | What happened | What an unmatched report records |
|---|---|---|
| 12 ETH bought on the exchange | Acquisition, £22,800 enters your ETH pool | Acquisition, correct |
| 12 ETH withdrawn to the hardware wallet | Transfer, still yours, no tax | Disposal at £31,200, gain of £8,400 |
| 12 ETH received in the hardware wallet | The same coins arriving, the £22,800 cost travels with them | New coins with zero cost |
| 12 ETH sold the following spring at £3,100 | Proceeds £37,200 less £22,800, gain £14,400 | Proceeds £37,200 less nothing, gain £37,200 |
Add it up. The correct gain across the whole history is £14,400. The unmatched report shows £45,600, and the overstatement of £31,200 is no accident, it is exactly what the coins were worth on the day they moved, because the phantom gain and the lost cost always add up to the transfer value. At the 24% rate on gov.uk that one unmatched row costs £7,488 in tax that was never due. The fix is a matched pair of rows, the withdrawal and the deposit tied together, with the cost basis flowing through to the real sale.
What does traced to a source row mean?
Every line in the ledger we hand over points at the evidence it came from. Take one row. 14 March 2026, 2.5 ETH out of a Kraken account, fee 0.0021 ETH. In our ledger that row carries the ledger ID from the Kraken export, the Ethereum transaction hash, the receiving address, and a note that the same 2.5 ETH arrived in your hardware wallet eleven minutes later. Change any one of those and the match fails, which is the point. You or an HMRC officer can open the export or the block explorer and see the same row.
That is also what HMRC asks for. The records list on gov.uk wants, for every pool, the type of token, the date, the number disposed of, the number left, the value in pounds and the pooled cost before and after, and it says in terms that exchange reports are not tax calculations and will not keep track of your pooled costs. Our record keeping guide sets out how to keep those records yourself, and where coins were lost or stolen the loss has to be evidenced in the same way.
How long does crypto reconciliation take?
A standard history, one or two exchanges, a few wallets and a single tax year, is reconciled and filed in 14 to 21 days from the day we have your exports. The number of gaps sets the time, far more than the number of transactions. A closed exchange with no export, a wallet you no longer have the address for, or a DeFi position that moved through three contracts each add days of rebuilding from the chain. A multi year catch up with heavy DeFi takes longer, and we quote the time with the fee. We give you the estimate on the free review once we have seen the files, and we tell you again if it changes.
What do I get at the end?
A reconciled ledger with every row traced to its source, and one section 104 pool per token showing the pooled cost before and after each disposal. A capital gains computation for each tax year, with the same day and 30 day matches shown separately so you can see why a disposal was matched the way it was. A schedule of income, staking, lending, airdrops and referral rewards, valued in pounds on the day received. Working papers that explain every judgement call, such as how a bridged token or a liquidity pool exit was treated and which HMRC paragraph supports it.
If you have engaged us to file as well, the figures go onto the cryptoasset section of the Self Assessment return, which gov.uk confirms exists on returns from the 2024 to 2025 tax year onwards, and the return goes in before 31 January 2027 for the year just ended, per the Self Assessment deadlines. One thing a reconciled ledger shows at a glance is total proceeds. If you are registered for Self Assessment you report the disposals even when the gain is under £3,000, once proceeds pass £50,000 in the year, per gov.uk on working out if you need to pay.
If you only need the reconciliation, you take the ledger to your own accountant or back into your software. Either way you keep the papers. The whole engagement is the first stage of our crypto tax service, the people doing it are our crypto tax accountants, and the crypto tax calculator shows what the corrected figure means in tax before you commit.
How much does crypto reconciliation cost?
Reconciliation is quoted together with the filing after the free review, as one fixed price in writing, and nothing is charged until you accept it. Among UK firms that do only crypto tax, one properly reconciled and filed year costs £750 to £2,000, checked against published prices in September 2026. A simple year filed from a clean software report can cost £300 or less, heavy DeFi or NFT years usually run £1,200 to £2,500, and a multi year catch up with a disclosure to HMRC comes in between £1,500 and £3,500.
The pricing page sets your own history against those bands in about twenty seconds, and our list of services says what each engagement includes.
Common questions about crypto reconciliation
What is crypto reconciliation?
Why can’t crypto tax software just reconcile it for me?
Does reconciliation reduce my tax bill?
Can you reconcile DeFi and multi chain activity?
How much does crypto reconciliation cost?
Do you need an accountant for crypto?
Can HMRC see your crypto?
Who does the reconciliation work?
What do I need to send you?
What stands behind every figure on this page
Every guide on this site is written by a practising crypto tax accountant who files these returns with HMRC. Every figure and every date is checked against gov.uk before a page goes live. When the guidance changes, the page is re-read and the checked date moves with it.
Certified Crypto Accountant is the trading name of Zar Enterprises Ltd, a UK limited company. The firm is licensed and regulated by the Association of Accounting Technicians, which also supervises it for anti-money laundering. The company is registered with the ICO as a data controller and holds professional indemnity insurance, so a named entity answers for every figure you read here. More about the firm, or get in touch.
- Last checked against gov.uk
- Company
- Zar Enterprises Ltd, company number 17310916
- Regulation
- Licensed and regulated by the AAT, licence 1010475
- Data protection
- ICO registration ZC225094
- Insurance
- Professional indemnity insurance with Hiscox