CRS 2.0 & CARF — Key Updates for Financial Institutions & Payment Service Providers

TAX & COMPLIANCE BULLETIN

CRS
1.    Purpose

This bulletin outlines the upcoming changes to Singapore’s Automatic Exchange of Information (AEOI) obligations that will impact businesses operating in the e-wallet and digital asset sector. The OECD’s updated Common Reporting Standard (CRS 2.0) and the newly introduced Crypto Asset Reporting Framework (CARF) will introduce new compliance and reporting requirements for financial institutions and payment service providers.

Singapore’s IRAS is expected to implement CRS 2.0 and CARF from 2027, with the first exchange of information taking place in 2028. Newly incorporated financial institutions, existing payment service providers (PSPs), and businesses entering the digital asset space should start preparing early to address the operational, regulatory, and compliance impacts.

CRS 2.0 — What’s Updated 

  • E-wallets, stored-value accounts, and Central Bank Digital Currencies (CBDCs) are now classified as Reportable Accounts and will be treated similarly to traditional bank accounts under CRS 2.0.

  • Stablecoins that fall within the definition of “Specific Electronic Money Products”.

  • Derivative contracts referencing Relevant Crypto-Assets or any related interest. are now within the scope of CRS 2.0.

  • Additional due diligence requirements will apply, including mandatory validation of self-certifications and stricter Tax Identification Number (TIN) verification checks.

  • Payment Service Providers (PSPs) offering e-money products will be required to register with IRAS as a Reporting Singapore Financial Institutions (SGFI) if they are not already registered for CRS reporting. 

CARF — What’s New

  • CARF is a new OECD reporting framework that expands tax reporting requirements to crypto asset activities and operates alongside CRS 2.0. 

  • Businesses facilitating crypto exchanges, custody, or transfers will be classified as Reporting Crypto Asset Services Providers (RCASPs). This includes exchanges, DPT service providers, custodial wallet providers, and digital asset brokers. 

  • Stablecoin which is a digital representation of value that relies on a cryptographically secured distributed ledger or similar technology to validate and secure transactions, will be in scope under CARF. 

  • RCASPs are required to report three key transaction types: crypto-to-fiat exchanges, crypto-to-crypto transactions, and crypto asset transfers. 

  • Additional KYC requirements will apply, including the collection of Tax Identification Numbers (TINs) and tax residency information for all users as well as remediation of incomplete records. 


2.    What Does it Mean for Your Business

CRS2.0 and CARF compliance are not 2027. It is Now. Get it right from Day One.

CRS 2.0 and CARF are more than compliance requirements. They significantly reshape how businesses operating in the digital assets and e-wallets function. Understanding their impact is crucial for effective planning, resource allocation, and strategic positioning.

For newly incorporated financial institutions and payment service providers entering the digital asset space, non-compliance is not only a regulatory concern, but it can lead to business disruptions, loss of client trust, delays in market entry, and increased regulatory scrutiny during a critical stage of growth. 

What You Should Do Now

  • Confirm your classification: use the IRAS CRS entity self-review tool and CARF RCASP self-review tool.
  • Register with IRAS: complete CRS and/or CARF registration via MyTax Portal.
  • Review product scope: assess whether e-wallets, stablecoins, tokenised assets, or crypto services fall within the updated definitions.
  • Upgrade onboarding: ensure KYC processes capture TINs and tax residency for all in-scope account holders.

3.    How BDO Singapore Advisory Can Support Your Business

BDO Singapore Advisory supports financial institutions and payment service providers throughout their CRS 2.0 and CARF compliance journey, from initial assessment to annual reporting. With deep expertise across IRAS, MAS, and OECD AEOI requirements, along with practical experience in the digital asset and fintech sector, we help businesses understand regulatory expectations, manage compliance risks, and implement practical solutions with confidence. 

For Newly Incorporated Financial Institutions

  • Entity classification and IRAS registration — We help determine your SGFI and RCASP status and support your registration with IRAS to ensure accurate classification from the start.
  • Compliance-ready onboarding design — We assist in designing KYC and self-certification processes that capture TINs and tax residency information during account onboarding, reducing future remediation risks. 
  • Policy and governance framework — We support the development of CRS and CARF compliance policies, internal procedures, and staff training materials to help strengthen governance and regulatory readiness.
  • Ongoing compliance retainer — We provide continuous support on IRAS and MAS regulatory developments, annual CRS and CARF reporting, and updates to keep your compliance framework aligned with evolving requirements. 

For Payment Service Providers Entering the Digital Asset Space

  • RCASP scoping and CARF readiness assessment — We assess whether your products and services fall within CARF’s scope, identify reportable transactions, and evaluate gaps in your current data collection and reporting processes. 
  • MAS licensing and AML/CFT alignment — We assist and support your Payment Services Act licensing application and align your AML/CFT controls with CARF due diligence obligations to strengthen compliance across both frameworks. 
  • Reporting system implementation — We support the implementation or enhancement of systems capable of generating OECD XML Schema V3.0 compliant CARF and CRS reports, including testing and submission support. 

  • Ongoing compliance retainer — We provide continuous support on IRAS and MAS regulatory developments, annual CRS and CARF reporting, and updates to keep your compliance framework aligned with evolving requirements. 

To learn how BDO Singapore Advisory can support your CRS 2.0 and CARF readiness journey, please contact: