Crypto: The French tax authorities could receive data from foreign platforms

The Senate has approved an agreement allowing the automatic exchange of information on cryptocurrencies held with foreign providers. This text does not create any new taxes, but it primarily gives the tax authorities the means to compare taxpayers' declarations with data received each year from their counterparts.

In brief

• The Senate has approved an agreement facilitating the automatic exchange of data on cryptocurrencies held abroad.
• The French tax authorities will receive information each year about taxpayers' accounts and transactions.
• This data will make it easier to identify undeclared accounts and tax inconsistencies.
• The first declarations are expected in 2027, as part of the European DAC8 framework.
• No new tax is planned. The system aims to strengthen controls but still needs final approval.

The tax authorities will receive data without prior control

The bill, adopted in first reading on October 27, allows France to approve the OECD's Crypto Reporting Framework. This agreement organizes the collection and then the exchange of information between the tax administrations of participating countries.

Until now, identifying a foreign crypto account largely depended on its declaration by the taxpayer or a targeted request from the tax authorities. The new system reverses this logic. Thus, information will be automatically reported, without an individual control being initiated first.

The concerned providers will have to transmit:

• The identity of the user and their tax residence;
• Their tax identification number;
• Conversions between cryptocurrencies and traditional currencies;
• Exchanges made between different cryptocurrencies;
• Transfers made to or from their accounts;
• The number, amount, and total value of transactions.

The data will be grouped by cryptocurrency and transaction category. They will then be exchanged annually between administrations, no later than nine months after the end of the relevant period.

The system will therefore not allow the French tax authorities to track every movement in real-time. Instead, it will provide an annual summary detailed enough to identify an unknown account, measure the volumes exchanged, and spot certain inconsistencies.

Declarations can be cross-checked on a large scale

The real change concerns the verification capacity. A French taxpayer must already declare certain crypto accounts opened, held, used, or closed abroad. They must also declare their taxable operations according to applicable tax rules.

However, the tax authorities had limited means to verify this information when the platform was located outside France. With the automatic exchange, they will be able to compare foreign data with declared accounts and the capital gains mentioned in the income declaration.

This comparison will not automatically prove fraud. A difference may arise from a transfer between two crypto wallets belonging to the same person, a non-taxable operation, or a different calculation method. However, it may trigger a request for explanation or an audit.

The rapporteur Emmanuel Capus clearly distinguished this cooperation from the tax rules themselves:

We are simply exchanging more information than we were already collecting.

The text therefore aims at detection capabilities, not the tax rate on gains. France has already transposed the European directive DAC8 into the finance law for 2025. Providers must collect information related to transactions made since January 1, 2026. The first declarations are expected in 2027.

The OECD agreement extends this logic beyond the European Union. However, its effectiveness will depend on the number of participating countries and the quality of the data provided by their platforms.

The Senate Vote Does Not Add Any Tax and Still Needs to Be Finalized

The text adopted by the senators is not yet a law definitively enacted. It has been sent to the National Assembly as part of an expedited procedure. Parliament here authorizes the approval of two international agreements signed in Assumption on November 26, 2024.

No new levy is created. The rules determining the taxation of capital gains remain unchanged, as does the obligation to declare the relevant foreign accounts. The agreement mainly makes omissions easier to discover.

The system also retains limitations. It primarily depends on the information held by platforms and other providers subject to reporting obligations. A self-custodial wallet, where the user retains the keys, cannot directly transmit the identity of its owner. However, data may appear when a transfer goes through a regulated platform.

The concentration of sensitive information raises a security issue. Tax data will associate an identity with assets and transaction volumes. The Senate report specifies that France will require its partners to provide confidentiality guarantees and may refuse exchanges with jurisdictions that do not meet its protection standards.

For French holders, the main change will therefore not be a new tax in 2027. It will be the gradual disappearance of the informational advantage enjoyed by certain foreign accounts. The administration may know of their existence even before questioning the taxpayer.