Hong Kong passes CARF crypto tax reporting bill

At a glance

Hong Kong’s Legislative Council (LegCo), the city’s lawmaking body, passed a bill on 4 Nov to bring in the Hong Kong CARF crypto tax reporting rules, the government said.
Crypto service providers must start collecting the required data next year, and the Inland Revenue Department (IRD) will exchange it with partner tax authorities from 2028, according to the government.

Hong Kong’s government welcomed the passage of the Inland Revenue (Amendment) (Crypto-Asset Reporting Framework and Amended Common Reporting Standard) Bill 2026 in a press release issued at 17:50 Hong Kong time on Wednesday.

What the law requires

The Crypto-Asset Reporting Framework (CARF) is a standard from the Organisation for Economic Co-operation and Development (OECD), published in 2023, under which tax authorities swap information on their residents’ crypto transactions once a year, according to the release. Each year’s reports will tie a customer’s identity to crypto-for-cash trades, swaps between tokens and transfers, among them moves to wallets held outside the platform, The Defiant reported.

The same law updates the Common Reporting Standard (CRS), the OECD system under which Hong Kong has shared bank and financial account data with other countries every year since 2018. The amended CRS covers digital financial products and adds reporting and due diligence requirements, the government said. It takes effect in 2028, with the first exchanges in 2029.

“Hong Kong has been supporting international efforts in enhancing tax transparency and combatting cross-border tax evasion,” said Christopher Hui, the Secretary for Financial Services and the Treasury. “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.”

The government said exchanges would be reciprocal and subject to data confidentiality and security. The IRD will issue guidance and has set up a team to answer industry questions, it said.

How we got here

The bill was published in the government gazette on 22 May 2026 and had its first reading in LegCo on 3 Jun, according to the IRD and a KPMG tax alert. KPMG said the CARF rules would apply from 1 Jan 2027 and the amended CRS from 1 Jan 2028. The new rules arrive as some platforms reshape their Hong Kong business, including Crypto.com’s plan to shut its Hong Kong consumer app on 1 Feb 2027, as CryptoWatchDesk reported on 3 Nov.

Elsewhere in Asia, South Korea has tied part of its crypto tax planning to Korea’s own CARF timetable, and on 4 Nov the ruling party asked the government to defer its 22% crypto tax, as covered in South Korea’s crypto tax debate.

What’s next

The IRD has not yet published its guidance for crypto service providers, and the government did not give a date for it. Data collection under CARF starts next year, the government said.

This is not tax advice.

This article is for information only and is not investment advice.