On 1 January 2026, Cayman Islands entities became subject to expanded international tax reporting obligations, following updates to the Common Reporting Standard (CRS) and the introduction of the Crypto-Asset Reporting Framework (CARF).
While many Cayman entities already comply with CRS, the updated framework introduces changes that may bring additional entities and activities into scope. Early assessment and preparation will be essential to ensure continued compliance and to avoid operational disruption once the new requirements take effect.
Changes to CRS scope
Under the revised CRS regime, Cayman Islands entities will continue to be classified as Financial Institutions (FIs) where they fall within one of the recognised CRS categories, including Depository Institutions, Custodial Institutions, Specified Insurance Companies and Investment Entities. However, the updated rules refine how these categories are applied, with the aim of increasing reporting coverage and addressing perceived gaps.
As a result, some entities that have historically been outside the CRS regime may now be required to register with the Cayman Islands Tax Information Authority. This is particularly relevant for investment structures, holding entities and vehicles with more complex asset profiles. A review of existing CRS classifications is therefore an important first step for affected entities.
Local accountability
One of the most notable changes is the requirement for each Cayman Reporting Financial Institution to appoint a Principal Point of Contact (PPOC) who is in the Cayman Islands. This individual will act as the primary liaison with the Department for International Tax Cooperation and is responsible for regulatory communications and remediation matters. Note: The PPOC may not be the person that makes the actual filings.
Although the new regulations came into force on 1 January 2026, for FIs already registered prior to the commencement of the regulations, the deadline for notification of a change of PPOC to someone in the Cayman Islands is 30 June 2027. Any new funds/FIs set up in 2025 will register for CRS in 2026 but, if they register after 1 January 2026, they will be required to register with a Cayman PPOC. Any funds/FIs launching in 2026 will need to register (by 31 January 2027) with a Cayman PPOC.
Entities that currently rely on overseas personnel or group-level contacts for CRS matters may need to revisit their arrangements for 2026. Corporate service providers with a Cayman presence can play a key role in supporting entities in meeting this requirement and Hawksford is able to offer a local PPOC service if a client requires it.
Updated filing timelines
The updated CRS framework also introduces revised filing deadlines for CRS returns, notifications and compliance forms. CRS returns (including nil returns) and Compliance Forms will be due by 30 June annually (shifted earlier from 31 July), starting for the 2026 reporting period (i.e. due 30 June 2027). Future filings must include declarations confirming that the information is adequate, accurate and current.
Crypto-assets and CARF
A further area of focus is the introduction of CARF – a new framework designed specifically to facilitate the automatic exchange of information relating to crypto-assets. It addresses perceived gaps in the existing CRS, which does not cover decentralised crypto-assets like Bitcoin, stablecoins, utility tokens, certain NFTs and security tokens.
At the same time, the expanded definition of Financial Assets under CRS means that certain crypto-related activities by existing funds/FIs may now trigger reporting obligations where none previously existed.
CARF targets Reporting Crypto-Asset Service Providers (RCASPs) in the Cayman Islands – entities incorporated, registered, managed in Cayman – that, as a business, facilitate exchange transactions in relevant crypto-assets for customers. This includes, exchanges and OTC platforms, crypto brokers, dealers and market makers, custodial wallet providers and operators of virtual asset trading platforms.
Preparing for 2026
The updated requirements came into force on 1 January 2026, meaning impacted entities must act now. This includes confirming CRS classification, assessing crypto-asset reporting exposure, appointing a Cayman-resident PPOC and reviewing internal systems, policies and service provider arrangements.
Please get in touch to find out how our Cayman team can support you and help ensure you remain complaint with the latest regulatory developments.
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