TL;DR,

• CARF Framework forces South African crypto exchanges to report all transactions above R5,000 starting March 2026, ending crypto anonymity.
• SARS opens public consultation until October 2025 for new crypto reporting rules that will require exchanges, brokers, and wallet providers to verify user identities and report annual transactions to tax authorities.
• Focus shifts from anonymity to accountability as on‑chain activity is reconciled with off‑chain KYC; coverage extends to crypto, stablecoins, and certain NFTs.

The South African Revenue Authority(SARS) just said now more “hidden” crypto transactions are setting up formal legal guardrails for its informal crypto markets. The Crypto-Asset Reporting Framework(CARF), developed by the Organisation for Economic Co-operation and Development (OECD), pairs advanced data sharing with tougher enforcement.

Now, SARS understands that such frameworks require some public participation, to some extent, and has open public consultations over the crypto reporting standard until 3 October 2025. Traders, organizations, have a chance to nitpick the draft before it goes live on 1 March 2026.

The main theme of the CARF Framework is that all CASPs: exchanges, brokers and wallet operators must identify you, the user, verify tax residency and report transactions annually.

What is the CARF Framework, and why is SARS adopting it now?

As per Chainalysts, South Africa’s crypto market received approximately $26 billion. It might not be Nigeria’s $59 billion, but it sets the pace for regulation. The CARF Framework is uniquely designed to close transparency gaps common in many digital assets.

Photo: SARS

Think of it as an attempt to expand the global playbook for automatic exchange of information to cover cryptocurrencies, stablecoins and various NFTs. It takes entities recognized by the Multilateral Competent Authority Agreement (MCAA) and adds a layer of rules and regulations.

RELATED: South African Crypto Regulation Advances While Tax Mechanics Remain Abstract

South Africa has always pioneered regulation in Africa; however, the CARF framework, since it places CASPs at the centre of due diligence. In a nutshell, under the new law, every player associated with digital assets will be considered as agents of the state, much like employers who collect pay-as-you-earn.

For SARS, it reconciles on-chain activity with off-chain KYC data, broadening the how far the regulatory body can track transactions. Wiehann Olivier, head of fintech, digital assets and private equity at Forvis Mazars in South Africa, clearly put it:

“The scope is broad, covering not only traditional cryptocurrencies but also stablecoins and certain NFTs.”

Entities that fall under the new framework include:

• Centralised and hybrid exchanges
• Brokers and over‑the‑counter (OTC) desks
• Custodial wallet providers and certain hosted wallet solutions

However, what makes this latest SARS crypto rules different? The Travel Rule mainly focuses on anti-money laundering(AML) and counter-terrorist financing (CTF), while the CARF Framework is designed for tax compliance. They complement each other like onion layers.

The SARS crypto rules for 2026: what’s changing?

There are a few changes the new addition brings. For instance, it gives SARS the mandate to pursue tax collection from the 5.8 million South African taxpayers engaging in crypto-related activities. Any transactions above the R5,000($288.59) threshold(as per the FAFT’s Travel Rule trigger) must be reported and include sender/receiver details. These include acquisitions, disposals, transfers, valuations, and cross‑border movements.

The most controversial take on the draft is its approach to blockchain’s anonymity. CASPs are expected to compile extensive user details, effectively tying each transaction to you. The very aspects of controlling your own assets remain, however, blockchain’s main selling point vanishes in thin air.

The new SARS crypto rules eliminate the ambiguity surrounding tax on crypto trading and activities. Short-term effects may include tipping results from frequent trading, crypto activities and even professional-style operations into the revenue account (ordinary income). If the draft is passed, the days of selective disclosure will be over, meaning crypto will be treated with the same level of diligence as trading financial instruments.

“Crypto is no longer a fringe asset class. It is now subject to the same scrutiny as traditional financial instruments,” says Olivier.

“This shift will influence investor behaviour, platform design, and product innovation. We expect to see increased demand for tax-efficient crypto investment structures, formalized reporting, and better integration between crypto platforms and traditional financial institutions.”

Non-compliance will result in heft penalties and even reinforcement action under the Tax Administration Act. The development, however drastic, was not unforeseen. SARS has issued thousands of letters to individuals flagged for non-compliance, warning of severe penalties for those who fail to cooperate.

RELATED: How South Africans Are Spending $112k Monthly Via Crypto Payments

Some of the taxable crypto events include:

• Converting crypto to fiat currency (potentially subject to capital gains or income tax)
• Swapping between different cryptocurrencies constitutes a disposal for tax purposes.
• Receiving staking rewards or interest (typically taxed as income)
• Mining cryptocurrencies (generally considered business income)
• Receiving airdrops or forks (may be taxable upon receipt)

“Now is not the time to take risks. SARS’s approach clearly shows we are dealing with a competent revenue authority.

 

So why risk it when compliance is evidently the preferred way forward, which SARS is willing and ready to assist all taxpayers with, as advised by Commissioner Edward Kieswetter.”Jashwin Baijoo, Associate Director at Tax Consulting SA.

Could Stricter Rules Push Trading Underground?

Here’s an unpopular opinion for most regulators and compliance checks: removing anonymity from each transaction is a double-edged sword.

While risk effectively becomes non-existent in centralized exchanges, it might push the majority of retail traders underground. Money laundering and illicit activities surrounding digital assets are a concern, and establishing guardrails does have some effect in safeguarding them. However, applying the same due diligence on tax on digital assets might cause many to run to decentralized alternatives.

Already, current reporting rules are causing a huge number of users to tell “half truths” over the actual figures. The CARF framework adds a layer of pressure, and the public participation is moving to see how its community reacts to these new regulations.