CARF Quick Guide

Summary

This is a DITC Quick Guide explaining the new Crypto-Asset Reporting Framework (CARF), implemented in the Cayman Islands via the Tax Information Authority (International Tax Compliance) (Crypto-Asset Reporting Framework) Regulations, 2025. CARF requires Cayman Reporting Crypto-Asset Service Providers (RCASPs) to conduct due diligence on their crypto-asset users and report transaction and identification information to the DITC for automatic exchange with partner jurisdictions, complementing the existing CRS regime.

• Who is in scope: Cayman RCASPs, i.e. entities or individuals that, as a business, effectuate exchange transactions in Relevant Crypto-Assets for customers, including exchanges, brokers, dealers, intermediaries, trading platforms and operators of Relevant Crypto-Asset ATMs, whether resident in the Islands or operating as a branch there.
• Due diligence: RCASPs must apply due diligence procedures (building on CRS self-certification and AML/KYC processes) to identify Crypto-Asset Users, Reportable Users, Reportable Persons and Relevant Transactions.
• What must be reported: Identification information on Crypto-Asset Users and beneficial owners, plus aggregated transaction data on exchanges between crypto-assets and fiat, exchanges between crypto-assets, and transfers (including retail payment transactions, airdrops, staking income, loans), categorised by asset type and transaction type.
• Where and how: Information is reported annually to the DITC; RCASPs must consider jurisdictional nexus rules to avoid duplicate reporting.
• Enforcement: Part 4 of the CARF Regulations allows the Authority to impose penalties for failure to submit returns, declarations or required information, including without first issuing a breach notice or considering representations.
• Relationship to CRS: CARF is a separate but complementary framework to the amended CRS; some entities will report under both, with aligned annual reporting cycles, consistent due diligence, similar IT systems and a dedicated CARF XML Schema, but differing in scope of assets, reporting service providers, and information reported.

The guide sets out a detailed implementation timeline (see deadlines) covering the effective date of the Regulations, registration deadlines for pre-existing and new RCASPs, self-certification collection deadlines, the first reporting date, and a rolling requirement to notify DITC of changes in circumstances.

Key obligations

• RCASPs must apply due diligence procedures from 1 January 2026 to identify Crypto-Asset Users, Reportable Users, Reportable Persons and Relevant Transactions.
• Pre-existing RCASPs must register required information (including a Cayman-based Point of Contact) with the DITC by 30 April 2026.
• New RCASPs must register required information with the DITC by 31 January of the year following establishment.
• RCASPs must collect valid self-certification for new individual and entity Crypto-Asset Users upon establishing the relationship, and confirm reasonableness of the self-certification.
• RCASPs must collect valid self-certifications for pre-existing individual and entity Crypto-Asset Users within 12 months of 1 January 2026 (i.e. by 31 December 2026).
• RCASPs must submit returns, nil returns, Partner Jurisdiction returns and declarations (and any other information requested by the Authority) with first reporting due 30 June 2027 for the 2026 calendar year.
• RCASPs must file a change notice with the DITC within 30 calendar days of any change in circumstances.
• RCASPs must familiarise themselves with jurisdictional nexus rules to avoid duplicate reporting.

Applies to

Reporting Crypto-Asset Service Providers (RCASPs), Crypto-Asset exchanges, brokers and dealers in Relevant Crypto-Assets, operators of Relevant Crypto-Asset ATMs, Financial Institutions subject to CRS (to the extent also subject to CARF)

Deadlines

• 1 January 2026: CARF Regulations come into force; RCASPs must begin applying due diligence procedures.
• 30 April 2026: Registration deadline for pre-existing RCASPs to register required information, including a Cayman-based Point of Contact, with the DITC.
• 31 January of the following year: Registration deadline for new RCASPs to register required information with the DITC.
• Upon establishing relationship: RCASPs must collect valid self-certification for new individual and entity Crypto-Asset Users.
• Within 12 months of 1 January 2026 (i.e. 31 December 2026): RCASPs must collect valid self-certifications for pre-existing individual and entity Crypto-Asset Users.
• 30 June 2027: First reporting under CARF (for the 2026 calendar year); submit returns, nil returns, Partner Jurisdiction returns and declarations.
• Within 30 calendar days: File a change notice with the DITC notifying of any change in circumstances.