DAC8

DAC8: reporting requirements for crypto and digital asset service providers in the EU

By:
Johan Loo
DAC8: reporting requirements for crypto and digital asset service providers in the EU
The European Commission has published new tax transparency regulations (DAC8) that apply to all service providers facilitating transactions in crypto-assets for EU-resident customers. The DAC8 rules require that crypto-asset service providers, regardless of size or location, report on crypto-asset transactions conducted by clients residing in the EU.
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Tax authorities encounter difficulties in tracking crypto-asset transactions. This significantly obstructs their capacity to guarantee the effective payment of taxes on transactions involving crypto-assets. The OECD has recently released its Crypto-Asset Reporting Framework (CARF) to address this issue. DAC8 follows the OECD CARF rules closely.

Crypto-asset service provider: information collection 

Crypto-asset service providers must gather, verify, and report various user information. Despite the initial statements in the Directive emphasizing the need to minimize the administrative burden on the industry, crypto-asset service providers will still face a substantial workload to organize this.

Reporting to the tax authorities

The crypto-asset service provider must provide certain information to local tax authorities. 

Monique Pisters, Head of Tax, explains DAC8 in more detail in this video. 

 

Entry into force per 2026

The Council of the European Union unanimously adopted the revised DAC8 on 17 October 2023. This decision comes after a political agreement was reached on 16 May 2023 and the issuance of a non-binding opinion on 13 September 2023 by the European Parliament. EU Member States are now required to implement the main rules of DAC8 into national law by 31 December 2025; the provisions will apply as of 1 January 2026. 

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