shares insights on Hong Kong’s Inland Revenue (Amendment) (AEOI) Bill 2026, currently under review by the Legislative Council. If passed, it will take effect on 1 January 2027.
Following a consultation held between December 2025 and early February 2026 on the implementation of the Crypto-Asset Reporting Framework (CARF) and the revised Common Reporting Standard (CRS), the Amendment Bill was published in the gazette on 27 March 2026.
At a glance:
- Mandatory CRS registration for all reporting financial institutions (RFIs), not only those with reportable accounts
- Record-keeping period extended to six years, recalculated from a fixed reference date
- New, proportionate sanctions for non-compliance, including per-account penalties
- A first step towards Hong Kong’s future adoption of the Crypto-Asset Reporting Framework (CARF)
1. Mandatory registration for all reporting financial institutions
Under the current CRS regime, only RFIs with reportable accounts must register in the AEOI Portal. The Amendment Bill proposes mandatory registration for all RFIs, regardless of whether they hold reportable information.
Existing unregistered RFIs must register by 31 March 2027, while institutions that become RFIs on or after 1 January 2027 must register by 31 January of the following year. Separate registration may not be necessary where an RFI is already registered under the “umbrella” of another RFI’s account — for instance, a trust registered under its trustee’s account, where the trustee reports the relevant CRS data (including nil reporting).
2. Enhanced record-keeping requirements
The Bill requires RFIs to retain due diligence records for six years, starting either from the end of the calendar year to which the records relate or from the due date for submitting the return — a change from the previous rule, under which the period ran from the completion of due diligence procedures. This six-year period applies even if the RFI has since ceased to exist or been dissolved.
If an entity is dissolved having been an RFI at any point in the six years before dissolution, every director (or, absent a director, every trustee or person responsible for management) immediately before the dissolution must notify the Inland Revenue Department within one month and ensure records are kept for the remainder of the retention period.
3. Stronger sanctions for non-compliance
The Bill introduces new sanctions for RFIs that fail, without reasonable excuse, to meet their obligations — including failure to register or the provision of incorrect or incomplete information. Penalties for certain offences, such as failure to carry out due diligence, will now be calculated by reference to the number of financial accounts involved, making sanctions proportionate to the scale of the breach.
“While the current scope of the Bill focuses primarily on strengthening the administrative aspects of the CRS regime, its provisions are expected to lay the groundwork for the future adoption of the Crypto-Asset Reporting Framework (CARF). As such, this Bill represents the first phase in a broader set of reforms aimed at evolving Hong Kong’s Automatic Exchange of Information (AEOI) regime.”
Why it matters
The reform confirms a global trend already familiar to Swiss and European trust structures: registration and record-keeping obligations for financial institutions — trustees included — continue to tighten, and enforcement is becoming more granular and proportionate to the risk involved. Trustees and advisers with Hong Kong-connected structures should review their AEOI registration status now, well ahead of the 2027 deadlines.
Source: Capital Trustees AG, Andrea Baroni Lugano