- India’s CBDT has included crypto assets and CBDCs within the Common Reporting Standard framework effective January 2026.
- The amendments target increased financial transparency by requiring institutions to report gross proceeds and derivative exposures.
- New rules aim to prevent double reporting by aligning CRS requirements with the Crypto-Asset Reporting Framework.
(INDIA) — India’s Central Board of Direct Taxes (CBDT) expanded the Common Reporting Standard framework to include crypto assets, central bank digital currencies (CBDCs), and specified electronic money products, effective January 1, 2026.
The CBDT change aims to strengthen financial transparency and cross-border tax reporting by bringing a wider set of digital financial products within the reporting ecosystem.
Amendments to Rule 114F(2) now treat any interest in a “relevant crypto-asset” as a financial asset for accounts other than U.S. reportable accounts, widening what financial institutions must track and report under the Common Reporting Standard.
The expanded definition also encompasses derivatives linked to crypto-assets, including futures, forward contracts, and options, extending reporting reach beyond spot holdings to instruments that can mirror crypto-asset exposure.
The term “relevant crypto-asset” broadly covers any crypto-asset except CBDCs and certain specified electronic money products, creating a defined perimeter around which digital assets fall under the CRS reporting scope and which do not.
Alongside broadening what counts as a financial asset, the CBDT changes add new reporting obligations for financial institutions acting in certain roles. Institutions must report gross proceeds from the sale or redemption of financial assets where they act as custodian, broker, or nominee.
The amendments also require collection of additional identification details when financial institutions update pre-existing account information in line with Prevention of Money Laundering Act (PMLA) requirements, including taxpayer identification numbers (TIN) and dates of birth.
While the measures expand reporting, the rules also address how institutions should avoid filing the same information twice when different reporting regimes may cover the same transactions.
A new Rule 114G(6A) clarifies that gross proceeds from the sale or redemption of financial assets need not be reported under the CRS framework if such information is already reported under the Crypto-Asset Reporting Framework (CARF).
The rule also states that reporting of crypto-asset transactions under CRS may be dispensed with where transactions are already reported under CARF, aiming to reduce duplication where parallel reporting channels exist.
Beyond crypto-assets and related instruments, the CBDT amendments introduce a simplified treatment for certain electronic money accounts. Electronic money accounts with a rolling 90-day average balance of not more than $10,000 may qualify for simplified treatment to ease compliance burdens.
In addition to transaction and proceeds reporting, the changes also tighten the set of account attributes institutions must maintain for reportable accounts under the framework.
Financial institutions must maintain additional information for reportable accounts, including whether the account holder has provided valid self-certification, whether the account is joint, and the number of joint account holders.
The CBDT notified the amendments on March 5, 2026 through Notification No. 19/2026 – G.S.R. 158(E), formally modifying Rules 114F, 114G, and 114H of the Income-tax Rules, 1962.
Those rules form the backbone of India’s reporting obligations under the Foreign Account Tax Compliance Act (FATCA) and the Common Reporting Standard, which require financial institutions to identify and report accounts held by foreign tax residents.
Taken together, the changes widen the set of financial assets that can trigger CRS reporting, increase the types of information collected and retained, and set boundaries for how institutions should treat crypto-asset transactions where CARF already applies.
Sandeep Bhalla, Partner at Dhruva Advisors, linked the changes to the growth of digital financial products and the need to maintain a compliance approach that still distinguishes between higher- and lower-risk cases.
“these amendments significantly expand India’s CRS reporting framework to cover emerging digital assets while maintaining a risk-based compliance approach. By bringing crypto-assets, electronic money products and CBDCs within the reporting ecosystem, India aims to ensure that cross-border tax transparency keeps pace with the rapidly evolving digital financial landscape,” Bhalla said.
The notification’s combination of an expanded definition of financial assets, enhanced gross-proceeds reporting when institutions act as custodian, broker, or nominee, and additional account-holder identification requirements increases the amount and type of data institutions must compile for reportable accounts.
At the same time, the CBDT’s introduction of a rule to avoid duplicate reporting where CARF already captures the same gross proceeds and crypto-asset transactions sets out how institutions can prevent overlapping submissions under multiple frameworks.
The simplified treatment tied to electronic money accounts with a rolling 90-day average balance threshold of $10,000 adds a separate compliance track, reflecting an approach that differentiates between account types based on specified criteria in the rules.
By folding crypto assets and certain adjacent products into the CRS perimeter from January 1, 2026, the amendments also extend the reporting framework across a broader span of digital financial activity, including derivative exposures linked to crypto-assets.
The operational effect for institutions under the Income-tax Rules, 1962 includes not only reporting outcomes—such as gross proceeds when applicable—but also the maintenance of enhanced account information, including the status of self-certification and whether an account is joint, along with the number of joint account holders.
With the notification issued on March 5, 2026 and the effective date set at January 1, 2026, the CBDT’s amendments anchor India’s Common Reporting Standard obligations more firmly to the evolving taxonomy of digital value, including crypto assets, CBDCs and specified electronic money products, while drawing a clear line on when CRS reporting can be set aside because CARF reporting already covers the same ground.
