To accept crypto payments, choose a route (a crypto payment processor, your own wallet, or an add-on for your ecommerce or payments platform), check the provider is registered with the financial regulator where you are, then add the option to your invoices or checkout. Most small businesses use a processor that converts each payment into their normal currency, so they never hold crypto.
Whichever route you pick, record what each payment was worth in your normal currency at the moment it arrived. Tax authorities in the UK and the US treat crypto taken as payment as business income, so your books need that figure from day one.
I'm writing this from the point of view of a small business owner deciding whether to add one more way to get paid. It isn't a case for or against crypto. It's the practical side: the decision, the setup and the admin that comes with it.
Should you accept crypto at all?
Start with your customers, not the technology. Work through these questions before you open any account.
- Do customers ask for it? If nobody has, a new payment option may sit unused while still adding admin.
- Do you have cross-border clients? Some businesses with international customers find crypto useful where bank transfers are slow or awkward. If your customers are local and happy paying by card, the case is weaker.
- What will you do with it once it arrives? Decide now whether you'll convert it straight away or hold some of it. If holding it would leave you short for wages or bills when its value drops, convert.
- Have you got time for the admin? Every payment needs a record, a value in your normal currency and a match to an invoice. That's more work than a card payment.
If most of your answers are no, waiting is a sound decision. You can revisit it when customers start asking.
The three ways to take it
There are three common routes. They differ in how much you handle yourself and whether you ever hold crypto.
A crypto payment processor that converts to your normal currency
This is the route most small businesses take. Processors such as BitPay, or Coinbase's merchant tools, create a payment page or invoice. Your customer pays from their own wallet, and the processor confirms the payment. Many can convert it into your normal currency and pay it into your business bank account, so you're not exposed to the value moving.
Processors usually charge per transaction, so check the current pricing page before you sign up. They also differ in which coins they accept and which countries they serve, so check what's available in your country first.
Your own wallet and an address or QR code
You can also give customers your wallet address, or a QR code on your invoice, and let them pay you directly. There's no middleman, but you handle everything: checking the right amount arrived on the right network, converting it if you want to, keeping records and keeping the wallet secure.
If you go this way, choose the wallet carefully. Here's what features a crypto wallet should have, and some general advice if you're still unsure about getting one. Store recovery phrases offline, and keep the logins for any exchange or wallet account in one of the password managers built for small businesses.
Through a payments or ecommerce platform add-on
Some ecommerce platforms list crypto payment apps in their app stores, and some payment providers have added crypto or stablecoin options in certain countries. This can be the simplest setup if you already sell online, because the option appears at your existing checkout. Availability varies by platform and country and changes often, so check what your own platform offers before you plan around it.
Setting it up, step by step
Once you've decided to go ahead, this is the order I'd work in.
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- Pick your route. A processor, your own wallet or a platform add-on, based on the questions above.
- Check the provider is registered with the financial regulator where you are. In the UK, crypto businesses need to be registered with the FCA, and the FCA publishes a register you can search. Elsewhere, check the equivalent regulator or licensing body.
- Set up the account and complete verification. Expect to provide business details and identity documents, just as you would for a business bank account.
- Decide whether to auto-convert. If you don't want to hold crypto, turn on automatic conversion to your normal currency where the provider offers it.
- Add it to your invoices or checkout. Add a payment link or button, and say clearly which coins and networks you accept.
- Update your terms with a refund policy. Say whether refunds are paid in crypto or your normal currency, and which value you'll use.
- Record every payment for your books. Note the date, the amount of crypto, its value in your normal currency, the customer, the invoice and the transaction ID.
The risks to plan for
None of these are reasons to avoid crypto on their own. They're the things to have an answer for before your first payment.
- Value swings. Crypto values can move a lot in a short time. If you hold it rather than convert, the money you were paid may be worth less by the time you use it.
- Payments can't be reversed. There's no chargeback. A refund means sending a new payment, which is why your terms need to cover it.
- Scams and wrong addresses. A payment sent to the wrong address or on the wrong network is usually gone. Watch for fake payment screenshots and for customers who overpay and ask you to send back the difference.
- Tax records. Every payment needs a value in your normal currency. Without good records, year-end gets painful.
- Regulation that changes. Rules for crypto firms are still being written in many countries. A provider that serves you today may change what it offers, so keep a second way to get paid.
Tax and records, in plain terms
In the UK, HMRC treats crypto a business receives as payment for goods or services as part of its business income, valued in pounds sterling at the time it's received. In the US, the IRS treats digital assets received as payment as income, valued in US dollars at fair market value on the date received. If you later sell or convert crypto you've held, that can be a separate taxable event.
This is general information, not tax advice. Check the current HMRC Cryptoassets Manual or the IRS guidance on digital assets, and speak to an accountant who knows crypto before your first payment, not after your first year.
For your records, keep these details for every payment:
- The date and time it arrived
- The amount and type of crypto
- Its value in your normal currency at that moment
- The customer and invoice it relates to
- The transaction ID, plus any conversion and the provider's charges
Most processors let you export a transaction report. Download it every month and file it with your bank statements, and your accountant will thank you.
Frequently asked questions
Is it legal for a small business to accept crypto payments?
In the UK and the US, businesses can generally accept crypto as payment. The rules sit mainly with the providers, who must be registered or licensed where they operate, and they change, so check the current position where you trade.
Do I need to keep the crypto I'm paid?
No. Many payment processors can convert each payment into your normal currency and pay it into your bank account, so you never hold crypto at all. Check which coins and countries your provider supports.
How do I refund a customer who paid in crypto?
You can't reverse a crypto payment, so a refund is a new payment from you to the customer. Say in your terms whether you refund in crypto or in your normal currency, and which value you use.
Do I pay tax on crypto payments?
In the UK and the US, crypto a business receives as payment is treated as business income, valued in your normal currency at the time you receive it. Check the current HMRC or IRS guidance and speak to your accountant.
