The following Tax guidance note Produced in partnership with Ali Kazimi and Chris Orchard of Hansuke Consulting Limited provides comprehensive and up to date legal information covering:
The Common Reporting Standard (CRS) is a global standard under which participating jurisdictions agree to exchange information about financial accounts held by individuals and entities in reporting financial institutions (FI) in the reporting jurisdiction that relate to account holders resident in the receiving jurisdiction. The regulatory requirements are contained in The International Tax Compliance Regulations 2015, SI 2015/878 (the UK Automatic Exchange Regs).
The introduction of the Common Reporting Standard (CRS) significantly added to the compliance burden on all Financial Institutions (FI).
FIs for these purposes include:
investment entities, and
specified insurance companies
The definition is drawn intentionally wide and will cover not only banks but also other FIs such as brokers and certain collective investment vehicles (CIV).
However, given that the regime covers almost all of the major global financial centres, the information that is expected from the operation of the CRS is expected to be invaluable to revenue authorities in their fight against tax evasion.
Given that the focus of the CRS is on the tax residency of account holders, FIs will need to develop procedures to ensure:
the proper classification of their existing and prospective customers
functionality to detect possible changes to customers’ residency status, and
follow-up validations to mitigate the risk of information being passed to the incorrect tax authority
The CRS sits as part of the
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