Binance is the world's largest crypto exchange and used by hundreds of thousands of UK investors. Reporting it to HMRC correctly has one specific trap that catches almost everyone: the USD pricing problem.
Step 1: Export your full Binance history
Log into Binance and navigate to Orders → Transaction History → Generate all statements. Select your full date range from account creation to today. Download the CSV.
If you have used multiple Binance products, you will need separate exports for each:
- —Spot trading history
- —Earn / staking rewards
- —Futures (if applicable)
- —P2P trading (if applicable)
- —Card transactions (if applicable)
Step 2: The USD pricing problem — and how to solve it
Binance denominates most trades in USDT or USD, not GBP. For HMRC purposes, every transaction must be valued in GBP at the time it occurred. Using a static conversion rate (e.g. always using £0.79 per dollar) is incorrect and will produce wrong gains. You need the actual GBP/USD exchange rate for the date and time of each trade.
This is the most common Binance reporting error. Someone who traded BTC/USDT throughout 2023 cannot simply apply today's exchange rate to all their trades. Polyconomic fetches historical GBP rates automatically for every transaction when you connect via API or upload a CSV.
Step 3: Apply HMRC's matching rules to calculate your gain
Once you have GBP-denominated values for every transaction, apply the three matching rules in order: same-day, 30-day, then Section 104 pool. This calculation must span your entire Binance history — not just the current tax year.
Example of why history matters
You started trading on Binance in 2019 and only export from 2022 onwards. Your Section 104 pool average for BTC is missing three years of purchases. Every gain you calculate from 2022 onwards uses the wrong cost basis — potentially overstating or understating your tax by thousands of pounds.
Step 4: Report on SA108
Your Binance gains form part of your overall capital gains position. Report the totals on form SA108 (Capital Gains Summary): total gains in box 3, total losses in box 4, annual allowance in box 6, and taxable gain in box 7. Binance staking rewards go on SA100 under other income — separately from capital gains.
Polyconomic connects directly to Binance via API and handles the USD→GBP conversion, matching rules, and SA108 figures automatically. Import your Binance history →
Frequently asked questions
Does HMRC know about my Binance trading?
Possibly. Binance has provided user data to HMRC in response to formal requests. HMRC also uses blockchain analytics to trace on-chain activity. UK-based Binance users should treat their trading as potentially visible to HMRC and report accordingly.
I traded BTC/USDT on Binance, not BTC/GBP. How do I calculate the GBP value?
Use the GBP equivalent of the USD (or USDT) value at the date and time of each trade. You need the GBP/USD exchange rate for every transaction. Most crypto tax tools, including Polyconomic, fetch historical exchange rates automatically.
Do Binance Earn rewards count as income?
Yes. Tokens credited to your account via Binance Earn, Simple Earn, or staking are treated as income at the GBP value on the date of receipt. They are not capital gains. The cost basis for CGT purposes when you later sell is the GBP value at the time you received them.
I used Binance Futures — how are those taxed?
Futures trading is a complex area. Profits may be taxed as income (if treated as a trade) or capital gains, depending on the scale and frequency of activity. Most retail futures traders are treated as capital gain events. Professional advice is recommended for significant futures activity.
I cannot export my full Binance history — it only goes back 3 years. What do I do?
Binance limits CSV exports to a rolling 3-year window in some cases. If you cannot get older history via CSV, try the API connection which may retrieve more data. If records are genuinely unavailable, document what you have tried and consult a tax adviser about how to handle the gap.
What if I transferred crypto between Binance and another exchange?
Transfers between your own accounts at different exchanges are not disposals and do not trigger tax. However, you need to make sure your Section 104 pool correctly includes all purchases regardless of which exchange they were made on. Missing exchange data means your pool average is wrong.
General information only. Consult a qualified adviser.