India Aligns Crypto Reporting Rules with OECD Framework

The Central Board of Direct Taxes (CBDT) in India has issued a detailed compliance framework for crypto asset service providers to report user tax residency and transaction details annually.

This move aligns with the OECD's global Crypto Asset Reporting Framework (CARF), which requires participating jurisdictions, including India, to collect users' tax information and share it with the Income Tax Department.

The framework aims to plug information gaps in crypto transactions, making it difficult for tax authorities to track cross-border deals. It creates a common global reporting standard for participating countries to automatically exchange information on reportable crypto transactions.

Crypto exchanges will need to collect users' taxpayer identification details and determine their tax residency under the new rules. The CBDT's 198-page guidance note explains how exchanges should undertake customer due diligence, maintain records of reportable crypto transactions, and furnish annual reports to tax authorities.