FATCA & The OECD’s Common Reporting Standard – Q&A

The Common Reporting Standard (CRS), a global initiative to introduce the automatic exchange of information on financial accounts beneficially owned by residents of foreign countries, took effect on 1st January 2016. Governments of signatory countries have drafted or are in the process of drafting local legislation in accordance with guidance provided by the OECD in August 2015. Financial institutions will need to report details of accounts owned by individuals, companies, trusts, foundations and other structures to their local tax authorities which will then exchange that information with the tax authority of the beneficial owner’s country of tax residence on an annual basis.

CRS reporting begins in 2017 or 2018 depending on the country in question (see details below), but every economically significant jurisdiction has now signed up. That means that revenue authorities worldwide will soon be collating tax data supplied by foreign financial institutions. CRS signals the end of banking secrecy and confidentiality and, any tax planning that seeks to defeat tax transparency will be doomed to failure.

What is the CRS?

Who does the CRS apply to?

Are the reporting agreements the same for each jurisdiction?

Which jurisdictions have signed the CRS?

When will reporting take place?

What will be reported?

What is a reportable financial account?

Can you advise me how to circumvent automatic tax reporting?

Could I face any liability?

Why are you doing this?

What happens if you do not comply with the CRS?

What if I refuse to provide information?

What can I do now?

What if I know that I am in default of my obligations?

This Q&A is not intended as tax advice and whilst every effort has been made to ensure that the details contained herein are correct and up to date, we do not accept any responsibility, legal or otherwise, for any errors or omissions.

Please contact Blenheim Global Assets for a free consultation.

Courtesy of Sovereign