New Zealand introduces strict crypto-reporting requirements for service providers, enforcing OECD’s Crypto-Asset Reporting Framework with significant fines for non-compliance.
New Zealand’s government has introduced a groundbreaking tax bill incorporating the Organisation for Economic Co-operation and Development (OECD) Crypto-Asset Reporting Framework (CARF). Under this new legislation, cryptocurrency service providers operating within the country face strict reporting obligations, with severe penalties for non-compliance.
On August 26, Simon Watts, the Minister of Revenue for New Zealand, unveiled the “Taxation (Annual Rates for 2024–25, Emergency Response, and Remedial Measures)” bill. This comprehensive legislation not only confirms annual income tax rates and offers tax relief measures but also mandates the implementation of the OECD’s CARF and introduces amendments to the Common Reporting Standard (CRS).
Related: Australia Proposes Adoption of OECD Crypto-Asset Reporting Framework
New Obligations for Crypto Service Providers
Beginning April 1, 2026, all Reporting Crypto-Asset Service Providers (RCASPs) based in New Zealand will be required to gather extensive information on users conducting transactions through their platforms. This data must be submitted to Inland Revenue by June 30, 2027, which will then be shared globally with relevant tax authorities by September 30, 2027.
This new reporting obligation is intended to ensure that profits from cryptocurrency trading are appropriately taxed. The New Zealand government has emphasized that as the crypto market grows, it becomes increasingly important for tax authorities to maintain oversight of income generated through digital assets.
Related: New Zealand Government Requires Crypto Traders to Pay Taxes
Penalties for Non-Compliance
RCASPs that fail to meet the new reporting requirements face significant penalties. For each instance of non-compliance with CARF, a fine of 300 New Zealand dollars (NZD) (approximately $186) will be imposed, up to a maximum of 10,000 NZD ($6,200). However, if service providers are found to have neglected “reasonable care” in adhering to CARF requirements, they could be fined between 20,000 and 100,000 NZD ($12,000 to $62,000).
Additionally, users who do not provide the necessary information to comply with these rules may be subject to a fine of 1,000 NZD ($621).
Related: Elon Musk Calls for Capital Gains Tax Deferral for Government Efficiency
Conclusion
This new legislation marks a significant step in New Zealand’s efforts to regulate the cryptocurrency market and ensure tax compliance on profits earned through digital assets. As global coordination on crypto-asset reporting intensifies, New Zealand’s adoption of OECD standards sets a precedent for other countries to follow.
