Hong Kong’s Legislative Council has passed an ordinance establishing a crypto-asset reporting framework. Platforms will collect information starting in 2027 and exchange it from 2028, but it remains unclear whether mainland China is on the exchange list.
Key points
• On November 4, Hong Kong’s Legislative Council passed the Inland Revenue (Amendment) (Crypto-Asset Reporting Framework and Amended Common Reporting Standard) Bill 2026. CARF will take effect on January 1, 2027, and Hong Kong plans to begin exchanging information in 2028.
• An OECD list shows that Hong Kong plans to exchange CARF information for the first time in 2028. Mainland China is not included in the list of jurisdictions that have made this commitment. The Hong Kong Inland Revenue Department says it will publish the list of reportable tax jurisdictions in due course.
• Platforms must collect self-certification information such as users’ tax residency and tax identification numbers. The quantities and market values of assets involved in fiat transactions, crypto-to-crypto exchanges, and transfers to self-hosted wallets may all be aggregated and reported.
• A platform’s collection of account information does not mean that it has been submitted to the tax authority, much less automatically exchanged. CARF sets out reporting and exchange procedures; it does not establish a uniform tax rate. Whether tax is imposed depends on local tax law.
• Under Hong Kong’s two-tiered profits tax regime, corporations pay 8.25% on their first HK$2 million in profits and 16.5% on any excess. In mainland China, income from transfers of property is subject to a flat 20% tax rate, but this cannot be applied directly to all crypto income.
Why it matters
The bill advances tax transparency for crypto assets. If mainland China is subsequently added to the exchange list, this could affect mainland tax residents’ reporting of overseas crypto assets and their compliance costs.
Key points
• On November 4, Hong Kong’s Legislative Council passed the Inland Revenue (Amendment) (Crypto-Asset Reporting Framework and Amended Common Reporting Standard) Bill 2026. CARF will take effect on January 1, 2027, and Hong Kong plans to begin exchanging information in 2028.
• An OECD list shows that Hong Kong plans to exchange CARF information for the first time in 2028. Mainland China is not included in the list of jurisdictions that have made this commitment. The Hong Kong Inland Revenue Department says it will publish the list of reportable tax jurisdictions in due course.
• Platforms must collect self-certification information such as users’ tax residency and tax identification numbers. The quantities and market values of assets involved in fiat transactions, crypto-to-crypto exchanges, and transfers to self-hosted wallets may all be aggregated and reported.
• A platform’s collection of account information does not mean that it has been submitted to the tax authority, much less automatically exchanged. CARF sets out reporting and exchange procedures; it does not establish a uniform tax rate. Whether tax is imposed depends on local tax law.
• Under Hong Kong’s two-tiered profits tax regime, corporations pay 8.25% on their first HK$2 million in profits and 16.5% on any excess. In mainland China, income from transfers of property is subject to a flat 20% tax rate, but this cannot be applied directly to all crypto income.
Why it matters
The bill advances tax transparency for crypto assets. If mainland China is subsequently added to the exchange list, this could affect mainland tax residents’ reporting of overseas crypto assets and their compliance costs.