Are crypto airdrops taxed? What the IRS, HMRC and ATO say

Often, yes, but it depends on your country and on why the tokens reached you. On pages we read on 27 October 2026, the IRS treats an airdrop that follows a hard fork as ordinary income; HMRC says Income Tax may not apply to an airdrop received without doing anything in return but does apply to one given for a service; and the ATO taxes an airdrop received for goods or services as ordinary income, while other non-business recipients generally face capital gains tax only when they dispose of the tokens. Rules differ in other countries and change over time, so check your own situation with your tax authority or a tax professional.

This is not tax advice: it reports what each authority's own pages say, with the date we read them.

United States: what the IRS says

The IRS's main statement on airdrops is Revenue Ruling 2019-24, published in Internal Revenue Bulletin 2019-44. It defines an airdrop as "a means of distributing units of a cryptocurrency to the distributed ledger addresses of multiple taxpayers", and its second holding reads:

"A taxpayer has gross income, ordinary in character, under § 61 as a result of an airdrop of a new cryptocurrency following a hard fork if the taxpayer receives units of new cryptocurrency."

The ruling ties timing to control. Airdropped cryptocurrency "generally is received on the date and at the time it is recorded on the distributed ledger", but not while the taxpayer is unable to "exercise dominion and control" over it, for example in an exchange wallet where the exchange does not support the new coin. In the ruling's worked example, a holder receives 25 units of a new coin worth $50 when the airdrop is recorded, has $50 of ordinary income, and has a basis of $50 in the coin.

The IRS FAQ on virtual currency transactions restates it: "If a hard fork is followed by an airdrop and you receive new cryptocurrency, you will have taxable income in the taxable year you receive that cryptocurrency." The FAQ also says "These FAQs generally apply to transactions involving digital assets completed before Jan. 1, 2025."

The IRS digital assets page says "Income from digital assets is taxable." It lists "An airdrop as it relates to a hard fork" among the receipts that mean answering Yes to the digital asset question on federal returns, says income "from forks, staking, mining, etc." goes on Schedule 1 of Form 1040, and says a later sale of a digital asset held for investment gives a capital gain or loss, short-term if held one year or less.

What these pages leave open. The ruling and FAQ answers deal with airdrops that follow a hard fork, not separately with the airdrops most readers of this site meet, such as a retroactive airdrop to an app's past users or tokens earned in a game. That is a question for the IRS or a tax professional.

The same IRS page warns that letters with a QR code asking you to register cryptocurrency on a "compliance portal" are a scam: "We don't require registration of digital assets and are not sending these letters."

United Kingdom: what HMRC says

HMRC's Cryptoassets Manual covers airdrops for individuals at CRYPTO21250. It describes an airdrop as "where someone receives an allocation of tokens, for example as part of a marketing or advertising campaign in which people are selected to receive them". On Income Tax, the page says:

• "Income Tax will not always apply to airdropped tokens received in a personal capacity."
• Income Tax "may not apply" if the tokens are received "without doing anything in return (for example, not related to any service or other conditions)" and "not as part of a trade or business involving cryptoasset exchange tokens or mining".
• "Airdrops that are provided in return for, or in expectation of, a service are subject to Income Tax either as: miscellaneous income; receipts of an existing trade".

On Capital Gains Tax: "The disposal of a token received through an airdrop may result in a chargeable gain for Capital Gains Tax, even if it's not chargeable to Income Tax when it's received."

HMRC's guidance Check if you need to pay tax when you receive cryptoassets (last updated 28 April 2025) lists the records it says must be kept for tokens received, among them the type of token, the date received, the number of tokens and their value in pound sterling. That page does not mention airdrops by name.

What this page leaves open. CRYPTO21250 does not say which everyday airdrop tasks, such as following an account or playing a game, count as a service or "other conditions". HMRC or an adviser can answer that for a particular case.

Australia: what the ATO says

The ATO's page Staking rewards and airdrops, last updated on 19 August 2026, says an airdrop may come "in return for goods or services", "from participating in a hobby or entertainment activity", "as a gift or windfall gain" or "as a result of a scam", and treats them differently:

• For goods or services: "you will include the market value of the airdropped crypto assets in your assessable income as ordinary income", and that market value becomes the cost base.
• Otherwise, outside a business: an airdropped asset "is a separate CGT asset", and a recipient who is not carrying on a business of crypto asset trading and did not receive it for goods or services or "as part of another income-producing activity" does "not include its market value in your assessable income". A CGT event may happen when it is later disposed of.
• Hobby or entertainment: the market value is not assessable income, and the related costs are not deductible. The ATO's example is a university student who earns "game coin" while gaming as a hobby.
• Value at receipt: if the asset has "no or negligible value at that time, the first element of the cost base will generally be nil."
• A scam offer: in the ATO's example, a holder emailed about 2,000,000 "dodgy coin" does not click the link, the coins never reach her wallet, and she has no income and no CGT asset.

The page points to Draft Taxation Ruling TR 2026/D1, Income tax: receipt and disposal of crypto assets by an airdrop, dated 19 August 2026. It calls itself "a draft for public comment" that "represents the Commissioner's preliminary view", took comments until 16 October 2026, and "will not take effect until finalised". From the draft:

• It names four kinds of airdrop: standard, bounty (for "simple tasks such as posting on social media"), holder and exclusive.
• A recipient carrying on a business of crypto asset trading includes airdropped assets as ordinary income "even if the receipt is as a result of a gift or windfall gain, or if the receipt is unsolicited."
• In its Example 6, a holder receives 10,000 tokens worth $0.025 each (a $250 cost base) and sells them 3 years later at $1.50 each, a capital gain of $14,750.
• For "initial allocation airdrops", the first distribution of a token that has not traded before, the final ruling is proposed to apply only to airdrops after it is issued.

The three side by side

What each authority's pages say, as read on 27 October 2026:

Other countries, and rules that change

This guide covers three tax authorities. Other countries have their own rules, and these three change too: the IRS FAQ is scoped to transactions before 1 January 2025, and the ATO's ruling is still a draft. Airdrop projects also put the question on you: the Eigen Foundation's airdrop terms (revised 9 May 2024) say "solely you are responsible and liable for all taxes due in connection with your participation in the Airdrop" and "you should consult a tax advisor".

For an answer about your own airdrops, the authority's own pages or a tax professional who knows your country are the places to go. What is a crypto airdrop and airdrop eligibility explain how airdrops are distributed. Fake tax letters are a scam format too, as the IRS alert shows; see airdrop scams and phishing.

Key takeaways

• IRS (Rev. Rul. 2019-24): an airdrop after a hard fork is ordinary income at fair market value when you can dispose of the tokens, and that value becomes your basis.
• HMRC (CRYPTO21250): Income Tax may not apply to an airdrop received for nothing, applies to one given for a service, and a later disposal may give a chargeable gain.
• ATO (updated 19 August 2026): an airdrop for goods or services is ordinary income; other non-business recipients generally meet CGT on disposal; draft ruling TR 2026/D1 gives the Commissioner's preliminary view.
• These pages are dated and country-specific: check your own situation with the authority or a tax professional.