Hong Kong enacts law mandating crypto exchanges to share customer data with tax authorities
A new Hong Kong law will require cryptocurrency platforms to collect and report detailed user and transaction information for tax purposes, starting in 2027.
Law takes effect in 2027, reporting begins in 2028
Hong Kong has passed legislation that obliges cryptocurrency exchanges and other designated service providers to gather comprehensive customer and transaction data for tax reporting. The rules become operative in 2027, and the first automatic exchanges of information with foreign tax authorities are scheduled for 2028.
Scope of the reporting requirements
Under the new law, covered platforms must record each customer’s name, address, tax residency and identification number. They must also retain records of every crypto purchase, sale, crypto‑to‑crypto swap and transfer to an external wallet.
Alignment with international standards
The measure adopts the Organisation for Economic Co‑operation and Development’s Crypto‑Asset Reporting Framework (CARF), released in October 2022, which aims to help governments detect crypto transactions that might otherwise go unreported for tax purposes.
How information will be shared
The Inland Revenue Department will compile annual transaction totals and the collected customer details, then forward them to tax authorities in jurisdictions where the customers are tax residents. This exchange will commence in 2028, extending Hong Kong’s existing participation in the OECD’s Common Reporting Standard, which has been in place since 2018.
Government statements and support
Christopher Hui, Hong Kong’s secretary for financial services and the treasury, said the rules are intended to combat cross‑border tax evasion. The Inland Revenue Department announced it will issue guidance and provide technical assistance to help firms comply with the new obligations.
Background on licensing and future extensions
Hong Kong introduced licensing requirements for crypto exchanges in 2023. The current amendment adds the reporting duty to those licensed entities. Amendments that broaden the Common Reporting Standard to cover additional digital financial products are set to take effect in 2028, with the first exchanges of that expanded data expected in 2029.
Overall, the law marks a significant step in Hong Kong’s effort to align its crypto regulatory regime with global tax‑compliance standards while keeping customer information private from the public.
