The UK tax authority (HMRC) has released new guidance on 14 May 2025 outlining reporting obligations for cryptoasset data under the OECD’s Cryptoasset Reporting Framework (CARF), set to take effect from 1 January 2026.
All UK-based “reporting cryptoasset service providers” (RCASPs) will need to report to HMRC.
What counts as an RCASP
A business is considered an RCASP if it either:
- transacts cryptoassets on behalf of users;
- provides a means for users to transact cryptoassets.
Some examples of an RCASP include cryptoasset:
- exchanges
- brokers
- dealers
What counts as a cryptoasset
A cryptoasset is a digital representation of value that uses a cryptographically secured distributed ledger (or similar technology) to validate and secure transactions.
To count as a cryptoasset under CARF, they must also:
- be used for payment or investment purposes;
- not need to be reported elsewhere under the Common Reporting Standard.
What counts as UK-based
Organisation is considered UK-based if any of these criteria apply:
- If they are a tax resident in the UK;
- If the business is incorporated in the UK;
- If the business is managed in the UK;
- They have a regular place of business or branch in the UK
If the criteria apply to both the UK and another country that follows CARF rules, they’ll only need to report in one country.
To work out which country to report in, they must use the criteria as a hierarchy with tax residence at the top. They should report in the CARF country that is highest on the hierarchy.
For example, if one is a tax resident in France and their business is incorporated in the UK — they only have to report in France. This is because tax residence is first on the hierarchy.
If two countries are at the same level on the hierarchy, they can choose which country they report in. For example, if one is a tax resident in both the UK and Germany, they can choose to report in either the UK or Germany.
What you’ll need to do
If one is a UK-based RCASP, they will need to start collecting information about their users and their transactions from 1 January 2026. Find out what information to collect.
Depending on the information collected, taxpayers may need to submit a report to HMRC by 31 May 2027. Find out about reporting cryptoasset data to HMRC.
By 31 January 2027, one will also need to:
- register with the online service — it’s not live yet, we’ll update the guidance once it is;
- tell users that their reporting details are being collected.
Penalties
A penalty of up to GBP 300 per user may be charged for non-compliance.
Situations where one could be charged a penalty include:
- if one does not report;
- if one submits their report late;
- if the report is inaccurate, incomplete or unverified.
