The proposed amendments are scheduled to be implemented on April 1, 2026, necessitating that crypto service providers based in New Zealand accumulate transaction information.
On Monday, the revenue minister of New Zealand suggested that the Legislature employ the OECD’s framework for the automated exchange of financial information regarding crypto-assets.
For this to happen, Minister Simon Watts suggested using the Taxation (Annual Rates for 2024–25, Emergency Response, and Remedial Measures) Bill.
The purpose of this legislative action is to incorporate the Common Reporting Standard revisions and the OECD’s Crypto-Asset Reporting Framework (CARF) into New Zealand law.
Accordingly, the target implementation date for these proposed changes is April 1, 2026. This will necessitate the collection of transaction information by reporting crypto service providers based in New Zealand. Reportable users are required to execute these transactions through the service providers.
A service provider will be subject to a $300 penalty per instance for noncompliance. In the interim, a crypto-asset user is subject to a $1,000 penalty for failing to provide the necessary information about themselves or a related individual.
Inland Revenue must receive this information from these providers by June 30, 2027. Subsequently, Inland Revenue will distribute this information to the appropriate tax authorities by September 30, 2027.
The minister emphasized that tax authorities face distinctive compliance challenges due to the technology underlying crypto assets, particularly cryptography. Consequently, tax officials are unable to exercise the same level of supervision over crypto-asset income as they do over income from traditional sources.
Andrew Bayly, the Minister of Commerce and Consumer Affairs of New Zealand, called for a substantial change in the country’s approach to the regulation of digital assets and the perception of blockchain technology earlier this year.
Last month, the tax authority of New Zealand announced its intention to concentrate on crypto merchants who have failed to declare their earnings from these activities in their tax returns, as part of its transition to a more proactive approach.
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