The Inland Revenue (Amendment) (Crypto-Asset Reporting Framework and Amended Common Reporting Standard) Bill 2026 was gazetted on 22 May 2026 and had its first reading in the Legislative Council on 3 June 2026. The bill is at the legislative stage and remains subject to LegCo scrutiny and amendment before enactment.
The bill amends the Inland Revenue Ordinance (Cap. 112) to insert a new reporting and due diligence regime for crypto-asset service providers (CASPs). CARF provisions take effect on 1 January 2027; the amended Common Reporting Standard provisions apply from 1 January 2028. Automatic exchange of tax information on crypto-asset transactions with partner jurisdictions is planned to commence in 2028, aligned with the OECD CARF global implementation calendar.
CASPs with a Hong Kong reporting nexus must register with the Inland Revenue Department (IRD), apply due diligence procedures to identify account holders and their tax residences, file annual returns with the IRD, and maintain records. Virtual asset trading platforms (VATPs) already licensed by the Securities and Futures Commission (SFC) under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (Cap. 615) must assess whether the CARF reporting nexus criteria apply to their activities and build reporting infrastructure before 1 January 2027.
Reporting nexus under CARF is determined by reference to the CASP's tax residence, place of incorporation, place of management and control, and, in certain cases, the residence of account holders. The bill defines these trigger conditions, but the IRD has not yet published detailed guidance on nexus analysis for specific business models. Entities operating across multiple jurisdictions will need to assess potential duplicate reporting obligations under the OECD's framework for avoiding overlap.
Licentium advises virtual asset businesses, crypto-asset service providers, and financial intermediaries on Hong Kong regulatory obligations. If you are assessing your CARF nexus position or building reporting infrastructure ahead of the 2027 implementation date, our team and partner network can assist. Work we undertake includes CARF nexus analysis, IRD registration procedures, CRS compliance for virtual asset intermediaries, AMLO licensing advisory, and AML/CFT programme design for SFC-licensed VATPs.