Crypto Tax Net Tightens: India Locks Into OECD Framework for Offshore Assets

TLDR:

• India will enforce OECD crypto reporting rules from April 2027, covering offshore wallets and foreign exchange accounts.
• The Crypto-Asset Reporting Framework enables global tax authorities to automatically share data on cross-border crypto activity.
• India will sign the Multilateral Competent Authority Agreement in 2026 to begin implementing OECD’s surveillance framework.
• Past offshore crypto holdings may also be flagged once the system is live, exposing undisclosed trades and assets.

India is preparing to overhaul the way offshore crypto holdings are tracked. The government will adopt the OECD’s Crypto-Asset Reporting Framework (CARF) by April 2027. 

Once live, the system will connect India to a global data-sharing network. This means wallets, trades, and balances held abroad will no longer stay hidden. The move closes a major gap in cross-border crypto taxation.

The OECD CARF to Reshape India’s Offshore Crypto Holdings

According to a report by Business Standard, India will sign the Multilateral Competent Authority Agreement in 2026. That agreement sets the foundation for CARF to function across countries. 

Once integrated, exchanges and service providers abroad will automatically share user data with Indian authorities.

The framework mirrors an existing system already used to track hidden foreign bank accounts. Now, it will cover crypto wallets, custodians, and centralized exchange accounts. That means offshore trades made years earlier may also get flagged once reporting begins.

KoinX explained on X that the change is not limited to future transactions. Data collected after 2027 could expose assets from previous years. This gives the government power to trace undisclosed income, even retroactively.

For investors who relied on foreign accounts to avoid scrutiny, compliance will no longer be optional. Tax notices could be issued for unreported gains stretching back multiple years.

What India’s Crypto Investors Need to Do Before 2027

Reports warn that waiting until 2027 could be costly. Once CARF activates, hidden trades or offshore wallets will immediately appear in India’s tax net. According to KoinX, the government will have access to wallet balances and exchange activity worldwide.

Crypto investors are being advised to begin regularizing their holdings now. Filing accurate reports through annual income tax returns is considered the safest step. For those who missed earlier years, India’s ITR-U process allows updates to past filings.

The framework represents one of the strictest global efforts to monitor cross-border crypto activity. By aligning with OECD rules, India ensures offshore holdings are treated the same as domestic accounts. Once live, investors who ignored compliance may find their historical transactions exposed.

Industry watchers describe this as the “final layer” in international crypto reporting. With timelines confirmed and agreements lined up, the countdown to 2027 has already begun.

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