Hong Kong has passed a new crypto tax reporting law that will require digital asset service providers to collect transaction information from 2027 and allow authorities to share the data with overseas tax agencies starting in 2028.
Summary
- Hong Kong’s Legislative Council passed a new crypto tax reporting law on November 4, adopting the OECD’s Crypto Asset Reporting Framework.
- Crypto service providers will be required to collect customer and transaction information from 2027, with automatic exchanges of tax data between Hong Kong and partner jurisdictions starting in 2028.
- The amended Common Reporting Standard will take effect in 2028, with international exchanges of financial account information under the updated rules beginning in 2029.
- Hong Kong’s Inland Revenue Department will issue guidance and provide technical assistance to help affected businesses comply with the new reporting requirements.
According to a November 4 government announcement, the Legislative Council approved the Inland Revenue (Amendment) (Crypto-Asset Reporting Framework and Amended Common Reporting Standard) Bill 2026, bringing the city closer to implementing international tax reporting standards developed by the Organisation for Economic Co-operation and Development.
The legislation introduces the OECD’s Crypto-Asset Reporting Framework, commonly known as CARF, alongside changes to the existing Common Reporting Standard, or CRS, which governs the exchange of financial account information between tax authorities.
Under the new requirements, covered crypto businesses will need to collect customer and transaction details for submission to Hong Kong’s Inland Revenue Department. The department will then exchange the information annually with eligible partner jurisdictions.
The government said the exchanges would operate on a reciprocal basis, with participating jurisdictions required to maintain appropriate standards for data confidentiality and security.
Hong Kong crypto tax rules will cover exchanges and customer transactions
The CARF framework applies to businesses that facilitate cryptocurrency transactions for customers, including exchanges, brokers, dealers and certain operators of crypto ATMs.
Companies with a reporting connection to Hong Kong will be subject to registration, customer due diligence, recordkeeping and reporting obligations.
The reporting requirements cover transactions involving exchanges between cryptocurrencies and fiat currencies, trades between different crypto assets and certain transfers involving external wallets.
Service providers must collect identifying information about reportable customers, including their tax residence and taxpayer identification numbers, alongside the relevant transaction details.
The framework covers both fungible and non-fungible crypto assets that can be used for payments or investments. Central bank digital currencies, specified electronic money products and certain assets that cannot be used for payments or investments are excluded.
The legislation follows an earlier consultation held between December 2025 and February 2026, during which the government sought feedback from financial institutions, professional bodies and cryptocurrency businesses.
Hong Kong subsequently published the proposed legislation in May before introducing it to lawmakers in June.
Financial Services and the Treasury Secretary Christopher Hui said the new requirements were part of the government’s efforts to improve international tax transparency and tackle cross-border tax evasion.
“Implementing the latest international standards for automatic exchange of information in tax matters is crucial to maintaining Hong Kong’s reputation as an international financial and commercial centre,” Hui said.
He added that alignment with international standards would strengthen confidence among financial institutions, crypto businesses and digital asset users considering long-term investments in Hong Kong.
Amended financial reporting standards will take effect in 2028
Alongside CARF, the legislation introduces changes to the Common Reporting Standard, which Hong Kong has used to exchange financial account information with overseas tax authorities since 2018.
The amended CRS will take effect in 2028, with the first exchanges of information under the updated requirements scheduled for 2029.
The changes expand the existing framework to cover certain digital financial products, including central bank digital currencies, specified electronic money products and financial instruments linked to cryptocurrencies.
Financial institutions will face updated due diligence requirements and additional reporting obligations concerning account holders, controlling persons and financial accounts.
The amendments include provisions intended to prevent duplicate reporting where transactions involving relevant crypto assets fall under both CARF and the updated CRS.
To help affected businesses prepare, the Inland Revenue Department plans to publish implementation guidance and has established a dedicated team to provide technical assistance and respond to industry questions.
The reporting legislation follows other regulatory changes in Hong Kong’s digital asset sector.
In October, the government outlined plans for licensing across four additional virtual asset services, covering dealing, custody, advisory and asset management activities.
The proposed licensing regimes would sit alongside existing rules for cryptocurrency trading platforms and stablecoin issuers.
Hong Kong’s September policy address had previously set out plans to expand regulated stablecoin trading and tokenized real-world assets, alongside additional surveillance measures for digital asset businesses.
OECD crypto reporting framework faces questions over coverage
The international reporting framework has attracted attention over how much cryptocurrency activity tax authorities can capture through regulated service providers.
As crypto.news previously reported in August, blockchain analytics firm Chainalysis estimated that potentially taxable onchain cryptocurrency activity exceeded $457 billion globally in 2025.
According to the firm’s analysis, transactions within the practical reach of CARF represented approximately 14% of that activity.
The remaining 86% included decentralized exchange transactions, peer-to-peer transfers, onchain income and cryptocurrency payments that fell outside the framework’s practical reporting coverage.
The OECD originally published CARF in 2023 to establish a common system through which participating jurisdictions could exchange information about cryptocurrency transactions involving their tax residents.
Hong Kong’s government said the Inland Revenue Department would continue working with the industry on implementation, with technical support available to businesses preparing for the new requirements.
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