Section 104 pooling and the 30-day rule — UK crypto tax
Quick answer: Group each token type into a pool with an average cost. When you sell, deduct a proportion of the pooled cost. If you buy the same token within 30 days of selling, special matching rules apply before the pool.
When you own the same type of crypto bought at different prices, HMRC does not use a simple first-in-first-out method. You must follow pooling and matching rules.
Section 104 pooling in plain English
Imagine you buy 1 bitcoin at £20,000 and later 1 bitcoin at £40,000. Your pool has 2 bitcoins costing £60,000 total — average £30,000 each. If you sell 1 bitcoin, your allowable cost is £30,000, not the price of the first or last purchase.
Same-day and 30-day rules
If you sell and buy the same token on the same day, those transactions match first. If you sell and rebuy within 30 days, the rebuy can match the sale instead of the pool — this stops people selling at year-end for the allowance then immediately rebuying. HMRC's Cryptoassets Manual explains the calculation order.
Frequently asked questions
Does swapping bitcoin for ethereum use pooling?+
Yes for the disposal — you sell bitcoin from its pool and acquire a new ethereum pool at the sterling value on the day of the swap.