India Tightens Crypto Tax Rules with New CARF Framework

India tightened crypto tax reporting by adding crypto assets and CBDCs to wider tax information rules. The CBDT issued fresh guidance in July 2026 for crypto platforms and financial institutions. 

The move aims to track digital asset activity more clearly across borders. It also brings India closer to the OECD’s CARF for global tax data sharing.

KPMG called the guidance “a significant step in operationalising India’s CARF” and expanding tax transparency for crypto assets.

The new rules place more responsibility on crypto exchanges, brokers, and wallet providers. These platforms must check customer details and confirm their tax residency information. They also need to collect Tax Identification Numbers where required under the reporting rules.

Crypto platforms must report certain transactions to India’s Income Tax Department each year. The information can cover crypto purchases, sales, exchanges, and transfers. Tax authorities can later share relevant information with other countries under CARF.

CBDCs and certain digital money products also come under the updated reporting system. This change gives authorities more information about digital financial activity across borders.

The rules also increase checks on high-value financial accounts. Accounts holding more than $1 million can face additional due diligence before reporting.

The move does not introduce a new crypto tax rate for investors. Existing tax rules for virtual digital assets continue to apply separately.

India’s CARF move also follows a wider global shift toward crypto tax transparency. The OECD designed CARF to help countries automatically exchange crypto-related tax information.

India is preparing for wider CARF information exchanges from 2027. The new reporting guidance gives crypto platforms a clearer compliance path before that stage.