EU kicks off 2026 with new digital asset tax reporting rules

The European Union’s new digital asset tax reporting directive took effect on January 1, mandating crypto asset service providers (CASPs) to report detailed user and transaction data to national tax authorities by July 1, 2026.

“The decentralised nature of crypto-assets has made it difficult for EU countries’ tax administrations to ensure tax compliance,” said the European Commission explainer. “The Directive lays down the rules and procedures for exchanging information on crypto-asset users by implementing due diligence procedures and reporting rules for operators active in crypto-asset transactions and their users.”

The directive, also known as DAC8, was adopted by the bloc on October 17, 2023, and all 27 EU countries had until December 31, 2025, to transpose it. The provisions took effect as of January 1, with 2026 being the first reporting year under the new rules.

DAC8 provides for the automatic exchange of information on ‘crypto assets’ between EU countries. This involves requiring EU countries to obtain information from the reporting CASPs “and exchange that information with the EU country of residence of the taxpayer/investor on an annual basis.”

The information must be exchanged with the the “tax authorities of the EU country of residence of the non-resident investor” within nine months of the end of the reporting year. Thus, the exchanges relating to the first reporting year must take place by September 30, 2027.

The rules are based on the Organisation for Economic Co-operation and Development’s (OECD) Crypto-Asset Reporting Framework (CARF), a global tax transparency initiative introduced in June 2023 to set a standard for tax reporting and improve the exchange of information between countries on digital asset transactions, to combat tax evasion and avoidance.

Increasing global agreement on CARF

In December, the OECD—a global institution that promotes policies to improve world trade and economic progress—published a report on the implementation of its global digital asset tax reporting standards, in which it stated that 75 jurisdictions have now committed to the rules, including “the vast majority” of digital asset centers.

As part of the CARF, all signatory countries agreed to an AEOI between tax authorities, in relation to accounts maintained by financial institutions.

At the time of writing, 76 jurisdictions have made a commitment to implementing CARF, among them many of the world’s top digital asset jurisdictions, by adoption rate, including the U.S., the United Kingdom, Brazil, Indonesia, Japan, and the 27 nations of the EU.

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