Cryptoasset firms will soon have greater disclosure requirements.
The Canadian government announced in the 2024 federal budget that it intends to implement the Crypto-Asset Reporting Framework (CARF), which the OECD agreed to in August 2022.
The G20 mandated the OECD to develop the framework to provide the automatic exchange of tax-relevant information on cryptoassets in April 2021.
The budget proposed providing the Canada Revenue Agency with $51.6 million over five years beginning in the 2024–25 fiscal year, and $7.3 million annually thereafter for implementation and administration.
New annual reporting requirements will apply to cryptoasset service providers resident in or carrying out business in Canada, and that provide business services facilitating exchange transactions in cryptoassets. This includes crypto exchanges, cryptoasset brokers and cryptoasset ATM operators.
The annual value of exchanges between cryptoassets and fiat currencies, exchanges between different cryptoassets and transfers of cryptoassets will be reportable to the CRA.
While the CARF excludes central bank digital currencies and certain digital representations of fiat currencies, such currencies will be included in the broadened scope of the OECD’s existing common reporting standard.
The measures will apply beginning in the 2026 calendar year, with the first reporting and information exchange occurring in 2027.