In a move to combat international tax evasion, the New Zealand government has announced plans to implement the Crypto-Asset Reporting Framework (CARF).
In a move to combat international tax evasion, the New Zealand government has announced plans to implement the Crypto-Asset Reporting Framework (CARF) developed by the Organisation for Economic Co-operation and Development (OECD) by April 2026.
This progressive step is outlined in the Taxation (Annual Rates for 2024–25, Emergency Response, and Remedial Measures) Bill, introduced by the Minister of Revenue, Simon Watts.
The OECD's CARF, which was approved in 2022, requires crypto-asset service providers to gather and report detailed information on their users' transactions to tax authorities.
Starting April 1, 2026, New Zealand-based crypto-asset service providers will be mandated to collect this data from their customers, according to a policy document on Monday.
By June 30, 2027, these firms will be required to report the transaction information to the Inland Revenue, New Zealand's tax agency. This data will then be shared with relevant tax authorities globally, ensuring greater transparency and enabling the fight against cross-border tax evasion.
The government has emphasized that the development of crypto-assets has made it challenging for tax authorities to maintain visibility over income and investment opportunities facilitated through intermediaries.
The implementation of the OECD's framework aims to address this challenge and ensure that profits derived from crypto trading are properly taxed.
Failure to comply with the new reporting requirements could result in significant penalties. Crypto-asset service providers who do not take "reasonable care" to meet the CARF obligations could face fines ranging from 20,000 to 100,000 New Zealand dollars (approximately $12,000 to $62,000).
Individual users who fail to provide the necessary information could also be subject to a 1,000 New Zealand dollar ($621) fine.
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