EU's Crypto Tax Reporting Begins January with Asset Seizure Threats
Starting January 1, 2026, the EU will expand its tax transparency framework to include crypto-asset service providers under the DAC8 directive. This new regulation requires these firms to collect and report detailed user and transaction data to national tax authorities, with information shared across member states to improve oversight of crypto holdings, trades, and transfers similar to traditional bank accounts and securities.
Crypto firms must transition to full reporting by the start of 2026, with a compliance deadline by July 1, 2026, mandating implementation of reporting systems, customer due diligence, and internal controls. After this date, national laws may impose penalties for non-compliance.
DAC8 operates alongside the Markets in Crypto-Assets regulation (MiCA), where MiCA governs licensing and customer protections, while DAC8 focuses on tax compliance and data sharing.
The directive also empowers regulators to embargo or seize crypto assets linked to unpaid taxes, including those held on platforms outside a user's home jurisdiction, through enhanced cross-border cooperation. This initiative closes existing regulatory gaps to ensure comprehensive oversight of the crypto sector.
