Automatic Exchange of Information – Common Reporting Standard “CRS”
The international tax compliance environment is subject to ongoing change. In particular there is a global move towards increased tax transparency and the automatic and compulsory exchange of information, including financial account information under the so-called Common Reporting Standard (“CRS”).
The CRS has been developed by the Organization for Economic Co-Operation and Development (“OECD”) and provides for the annual automatic exchange of financial account information between participating jurisdictions. Further information can be found on the following websites:
All relevant financial centres have committed to implementing the CRS, however, it will not be implemented by all jurisdictions at the same time. Gibraltar, as an early adopter country, has agreed with around sixty countries (EU and non-EU countries) to have the first exchange of information in 2017 for the tax year 2016.
Financial institutions in participating jurisdictions, such as Bank J. Safra Sarasin (Gibraltar) Ltd, will be required to report the client information listed below for accounts held by reportable persons (i.e. individuals and/or entities) to these persons’ country of tax residence. This reporting is regulated by the CRS and the respective local regulation of each participating CRS jurisdiction:
- Name, address, jurisdiction of tax residence
- Tax identification number(s), TIN(s) (if applicable)
- Date and possibly place of birth (for individuals)
- Account number
- Role of the reported person in case of Controlling Persons of Passive Non-Financial Entities (NFEs)
- End of year Acco
- unt balance
- Gross amount of interest, dividends and other income
- Gross proceeds from the sale and redemption of financial assets
- Name and identifying number of the reporting financial institution
For entities categorized as Passive Non-Financial Entities (e.g. domiciliary companies, certain trusts and foundations), the bank keeping the account will be required to report data on the Controlling Person(s) (e.g. beneficial owner, settlor, trustee, etc.).
In the case of a professionally managed entity that is itself treated as a Financial Institution, e.g. a trust or company with a discretionary asset management mandate with a bank, the client is itself required to comply with above mentioned reporting obligations. If this is the case, and if the entity is domiciled in a partner jurisdiction of Gibraltar, there will be no reporting through the bank.