Starting 1 January 2026, UK-based crypto exchanges and wallet providers must collect detailed user profiles, including full names, dates of birth, tax identification numbers, and residential addresses. This requirement follows the adoption of the OECD Crypto-Asset Reporting Framework (CARF) by the HMRC.
The data collection applies to all individual users, regardless of whether they engage in reportable activity. The first annual reports covering 2026 are due to the HMRC by 31 May 2027. The agency expects this initiative to help recover at least £300 million in unpaid taxes over a five-year period.
The HMRC has utilized blockchain analytics tools since 2020 to link user identities to on-chain transactions. Critics express concern that combining this data with residential addresses creates privacy risks, as Bitcoin transactions are recorded on a public, permanent ledger.
The framework facilitates international data sharing among participating jurisdictions, meaning collected information may be transferred outside the UK. Additionally, the government is considering expanding these information-gathering powers to a broader range of crypto businesses.
