Crypto as an intangible fixed asset: Corporation Tax under Part 8

In short: Crypto falls within CTA 2009 Part 8 only if the accounting and tax conditions are met, including acquisition for continuing use. Simply holding investment tokens is insufficient. Qualifying debits and credits follow the relevant business; a net gain held for neither trade nor property goes in CT600 box 195. Taxley, a UK online Corporation Tax (CT600) filing service, supports screened Part 8 cases, including specified tax-value differences.

Check whether Taxley fits your company, or see filing prices.

Key facts (checked on 26 October 2026)

When can company crypto qualify as an intangible fixed asset?

The company must have an accounting intangible that was acquired or created for continuing use in its activities, and satisfy the remaining Part 8 conditions. An investment holding does not qualify merely because it appears under intangible assets. HMRC makes that distinction specifically for exchange tokens in CRYPTO41150.

HMRC goes further in CIRD11170: tokens kept to pay for goods or services may be held and then used up, rather than used continuously. Neither long ownership nor an intention eventually to spend tokens proves the test.

Taxley asks why the company first acquired the crypto, whether it has been shown as an intangible throughout, and about previous Part 8 treatment. Keep contemporary evidence of acquisition purpose and the accounting policy. Do not select the route because an impairment would give a larger deduction.

An asset acquired for qualifying continuing use remains fixed if that use later stops, subject to the other conditions. CIRD11170 expressly addresses that situation. Where crypto was bought simply to hold and only used later, do not assume Part 8 begins automatically. The Bitcoin guide covers ordinary investment holdings; historic inconsistent treatment remains outside Taxley's supported cases.

Which CT600 boxes does Part 8 crypto go in?

Qualifying Part 8 amounts follow the activity for which the asset is held. Trade amounts enter trading profits; property amounts enter property profits. Otherwise, combine the non-trading credits and debits. A positive net goes in box 195, while a current non-trading loss is reported in box 830.

The activity allocation follows CIRD13520 and CIRD13530. “Neither” still means a qualifying business or commercial purpose, not personal use. The return's box destinations are explained in HMRC's CT600 guide.

A current non-trading loss claim against total profits goes in box 265. It may be smaller than the loss arising. Keep unused amounts in their own loss records; CIRD13540 explains the claim and carry-forward conditions.

Taxley asks where the accounts amounts sit and where they belong for tax. For example, a trade-use impairment in depreciation must be reflected in trading profit after the general depreciation add-back. A neither-use credit already included in business income must leave that income before entering box 195.

How does an impairment work when tax and accounts values differ?

An accounts impairment does not always equal the Part 8 deduction. For periods after the cost was first capitalised, scale the charge by the tax written-down value divided by accounts value immediately before the charge. This preserves the tax basis where earlier revaluations or other differences have separated the values. See CIRD12770.

Illustrative example: a qualifying non-trading asset has tax written-down value of £10,000 and accounts value of £12,000. A £3,000 impairment gives a tax debit of £3,000 × £10,000 / £12,000 = £2,500 under CTA 2009 s.729. Tax written-down value becomes £7,500.

Assume an investment company that is a CIHC, a 12-month period ending 31 January 2026, £6,000 bank interest and £2,200 qualifying management expenses. There are no other Part 8 amounts, losses, disposals or reliefs, no fixed-rate election, and the investment business continues.

No marginal relief applies because the example company is a CIHC: CTM03951. This example assumes the asset already qualifies for Part 8. It does not establish that a particular coin or planned use qualifies.

How are revaluations and impairment reversals taxed under section 723?

Section 723 covers revaluation increases, including restoration of past losses. The taxable credit is the smaller of the tax-adjusted increase and relevant previous net tax debits. An accounts uplift therefore need not be fully taxable. HMRC explains both impairment reversals and the cap in CIRD13050.

On the accounts-based route, use increase × tax written-down value / accounts value, then apply the previous-net-debits cap. Section 723 includes restoration of past losses. Do not use section 725's different accounting-loss reversal rule for an impairment restoration: CIRD13090 expressly excludes those section 723 gains.

Illustrative example: immediately before revaluation, both values are £6,000 and relevant prior net tax debits are £4,000. An £8,000 accounts uplift gives an adjusted increase of £8,000. The tax credit is capped at £4,000. For a qualifying neither-use holding with no other Part 8 amounts, box 195 is £4,000.

Using the same interest, management expenses, period and CIHC assumptions as the impairment example, box 315 is £6,000 + £4,000 − £2,200 = £7,800. Corporation Tax is £1,950 at 25%, without marginal relief. The accounts uplift must be reconciled separately so it is not also taxed elsewhere.

An impairment restoration can likewise be scaled: a £1,200 restoration at tax value £5,000 and accounts value £6,000 produces £1,000 before the cap. This assumes previous relevant net debits of at least £1,000 and no election. Taxley needs the actual prior debit and credit history, not an invented zero.

How does the 4% fixed-rate election change the calculation?

A valid election substitutes fixed-rate tax deductions for accounts-based write-offs. The annual deduction is generally 4% of tax cost, capped at remaining tax written-down value, with a proportionate reduction for a short accounting period. The election does not make an otherwise ineligible crypto holding qualify for Part 8.

CIRD12905 says the election is irrevocable and must be made in writing within two years after the end of the accounting period of acquisition or creation. CIRD12910 explains the calculation. Answering Taxley's election question records an existing election; it does not itself make one.

Illustrative example: tax cost £10,000, opening tax written-down value £8,000, full 12-month period and a valid 4% election. There are no purchases or sales during the period. The deduction is £400. For the same non-trading investment company assumptions above, box 830 and the box 265 claim are £400, box 315 is £3,400, and tax at 25% is £850.

Under this election, section 723 does not impose a credit for an uplift: see CIRD13050. That does not exempt a later sale. A complete realisation generally compares net proceeds with tax written-down value, as CIRD13250 explains.

What does Taxley ask, and which Part 8 cases remain unsupported?

Taxley asks about acquisition purpose, historical accounts treatment, business use, accounts placement, write-downs, reversals and sales. Where tax and accounts values differ, it also needs opening values, relevant prior net tax debits, additions, revaluations and election details. These answers support the tax reconciliation rather than assuming every accounts movement is deductible.

On the tax-value route, support is limited to one kind of coin, at most one valuation movement and the confirmed order of purchases, sales and period-end movements. Purchases with different tax and accounts costs, purchases or sales under a fixed-rate election, and movements outside that sequence remain unsupported.

Taxley also cannot yet file mixed-use allocations between activities, inconsistent historical Part 8 treatment, crypto shown in different ways in the accounts, stablecoins, NFTs or rights tokens, non-commercial holdings, staking or other income earned on a Part 8 holding, or relevant amounts split across unsupported lines or netted against other items. A write-down, reversal or revaluation within the non-negative depreciation and amortisation line has a specific supported treatment; that does not permit netting elsewhere.

For a trading, property or mixed company holding the crypto for neither business, a non-trading loss or brought-forward intangible loss remains unsupported. Additional uncaptured non-trading Part 8 amounts are also outside scope. Long-period fixed-rate support has further limits in the two-return guide.

Reward income on crypto that isn't a Part 8 holding needs the separate staking and mining checks. Dealers need the trading-stock guide. Check your company's fit, then view pricing.

Frequently asked questions

Does showing Bitcoin as intangible prove Part 8 applies?

No. Accounting treatment is only one condition. The token must also meet the tax fixed-asset test and the other regime conditions. HMRC specifically distinguishes exchange tokens acquired for continuing use from tokens simply held as investments.

Do tokens bought to pay suppliers qualify for continuing use?

Not automatically. HMRC says tokens held and then spent or used up may fail the continuing-use test. Keep the actual acquisition purpose and use evidence; an intention to make future business payments does not settle qualification.

Does an impairment reversal always use section 725?

No. Restoration of an impairment falls within section 723's revaluation rules. Its ratio adjustment and previous-net-debits cap can produce a smaller credit than the accounts restoration. Section 725 concerns a different class of accounting-loss reversal.

Does a company put a Part 8 loss in box 195 as a negative?

No. A net non-trading gain belongs in box 195, while a current non-trading loss belongs in box 830. The amount claimed against current profits is separate in box 265 and may be less than the loss arising.

Can I choose 4% in Taxley without making an election?

No. The calculation requires a valid written election made within the relevant deadline. Taxley's question records whether that election exists. It does not create an election or extend the statutory time limit for making one.

Does stopping use automatically move the crypto to capital gains?

No. HMRC says an asset acquired for continuing use remains a fixed asset when that use stops. Other Part 8 conditions still matter. A disputed historical classification or a change in accounts treatment needs the separate checks described above.

Review your figures before you file, ideally with a qualified adviser.