CARF: international tax reporting for crypto

CARF stands for Crypto-Asset Reporting Framework. It is an international regulatory framework developed by the OECD.

The rules require crypto providers to collect information about where customers are tax resident. If the customer is tax resident in another country, the provider must also collect the customer's tax identification number in that country.

Crypto providers must report information on crypto holdings and transactions to the tax authorities. The tax authorities can then share this information with the tax authorities in the customer's country of tax residence.

Within the EU, this framework is incorporated into a directive called DAC8. The rules are based on similar reporting requirements that have applied to banks, securities dealers, asset managers, and life insurance companies since 2016.

In Norway, reporting under CARF also applies to Norwegian customers.

When you create an account with Firi, or when we update your customer information, we will ask where you are tax resident.

If you are only tax resident in Norway, Denmark or Sweden, you simply need to confirm this.

If you are tax resident in another country, you must provide:

We report this information to the Norwegian Tax Administration (Skatteetaten). If you are tax resident in another country, Skatteetaten may share this information with the tax authorities in that country.

Firi is required to report the following information to Skatteetaten annually:

What is a TIN?

TIN stands for Tax Identification Number. It is a number used by tax authorities to identify taxpayers.

The name of this number varies from country to country. For example:

Where can I find my TIN?

You can usually find it in documents from the tax authorities in the country where you are liable for tax. For example, it may appear on your annual tax statement, tax return, or on your ID documents.

If you are unsure, we recommend that you contact the tax authorities in the relevant country. You can also find more information on the OECD website.

What does it mean to be tax resident in a country?

The rules vary from country to country. In most countries, it concerns where you live and spend the majority of your time. It may, for example, be linked to whether you have stayed in the country for 183 days or more.

You are not considered tax resident in a country simply because you own property there.

If you are unsure whether you are tax resident in another country, you should contact the tax authorities in that country.

Why do you ask about citizenship when this is about tax residence?

We ask about citizenship as part of our standard customer due diligence in accordance with anti-money laundering regulations and the new EU crypto regulation, MiCA (Markets in Crypto Assets).

What happens if I do not provide the information?

Firi is legally required to collect this information. If we do not receive the necessary information regarding tax residency or a valid TIN when required, it may result in us having to restrict your account or terminate the customer relationship.