Hong Kong has passed a law that will require cryptocurrency exchanges, brokers and other digital asset firms to collect their customers' tax information from the start of 2027, bringing crypto trading into the same cross-border reporting system that already covers bank and brokerage accounts.

The Legislative Council passed the Inland Revenue (Amendment) (Crypto-Asset Reporting Framework and Amended Common Reporting Standard) Bill 2026 on Wednesday, 4 November, the government said. The law adopts the Crypto-Asset Reporting Framework, or CARF, a tax transparency standard published by the Organisation for Economic Co-operation and Development in 2023, alongside the OECD's update to the Common Reporting Standard for bank and investment accounts.

What crypto platforms must report

The framework applies to what the OECD calls reporting crypto-asset service providers: any business that carries out exchanges between crypto assets, or between crypto assets and fiat money, for customers. According to guidance from the Inland Revenue Department, that covers trading platforms, dealers buying and selling for their own account, brokers, operators of crypto ATMs and market makers that earn a bid-ask spread.

Three kinds of transactions are reportable: crypto-to-fiat trades, crypto-to-crypto swaps and transfers, including transfers to external wallet addresses. For each customer who is tax resident in a reportable jurisdiction, providers must send the Inland Revenue Department the customer's name, address, tax residence and taxpayer identification number, along with aggregated figures for each type of crypto asset, including the gross amounts paid or received, the number of units and the number of transactions.

The definition of a crypto asset is broad and covers non-fungible tokens as well as fungible ones. Central bank digital currencies and specified electronic money products are excluded, as are tokens that a provider determines cannot be used for payment or investment.

Deadlines and penalties

New customers must give a self-certification of tax residence when they sign up. For existing users, providers have 12 months after the rules start to collect the same declarations. Knowingly or recklessly giving false information in a self-certification will be an offence.

Every provider that meets the law's nexus rules must open an account on a new Inland Revenue Department reporting portal, even if it has nothing to report. Registration is due by 31 January of the year after a firm first meets the criteria, which for providers already operating in the city points to January 2028. Firms must keep due diligence and reporting records for six years after each return is due, and that duty survives even if the company is dissolved.

The law sets penalties for failing to register, carry out due diligence or report, and for filing incorrect or incomplete information. Some fines will scale with the number of days an offence continues or the number of users involved. The department will also be able to impose financial penalties as an alternative to prosecution, with a right of appeal to the Board of Review.

Timeline for the data exchanges

CARF will take effect on 1 January 2027, with providers starting to collect the required information from that date and the Inland Revenue Department beginning to exchange it with partner jurisdictions in 2028. The second half of the law updates the Common Reporting Standard, which Hong Kong banks, insurers and fund managers already follow. From 2028, the standard will cover central bank digital currencies, specified e-money products, derivatives that reference crypto assets and investment entities that hold crypto, with exchanges under the new rules starting in 2029.

Secretary for Financial Services and the Treasury Christopher Hui said adopting the standards was important to Hong Kong's standing as a financial centre. He said alignment would reinforce the confidence of crypto-asset service providers, financial institutions and users of digital assets.

PwC Hong Kong said the bill is expected to be gazetted as an amendment ordinance on 13 November 2026, and advised firms in scope to move from monitoring developments to implementation planning, checking whether their systems can capture reportable transactions and collect self-certifications in time.

The timing matters for Hong Kong's push to grow its licensed digital asset market. Elsewhere in the region, crypto taxation remains unsettled: South Korea has pushed back its crypto gains tax, while Hong Kong has now locked its reporting rules into law.