Common Reporting Standards
- 1. Common Reporting Standard (CRS) – Overview CRS Overview CRS – Common Reporting Standards formally known as automatic exchange of financial information among jurisdictions Formulated on 21st July 2014 by OECD for exchanging financial information on an annual basis. The new standard leverages extensively on FATCA , EU–Saving directives and global anti-money laundering standards. 101 countries have committed to implement CRS; 50 among them are early adapters, going live by 2018. Benefits- Timely detection of non-compliances. Prevention of tax evasion by awareness and education to tax players and eventually increasing fairness and Tax revenue. Components :- Reporting standards and due diligence rules. Model CAA (Competent Authority Agreement) :- Detailed rules on the exchange of information. C o r e S c o p e Financial institutions in-scope:- Banks Custodians Accounts in-scope :- Accounts held by individuals, entities, and individuals controlling passive entities in reportable jurisdictions . Investment income in-scope:- Interest Dividends Other financial institutions Insurance companies. , Hedge funds & WM Income from insurance contracts Account balances and sales proceeds from financial assets Four core requirements to implement the standard:- 1. Translating CRS into domestic laws. 2. Establishing legal basis for automatic exchange of information (Exp:-MCAA ). 3. Establishing admin process & IT systems. 4. Protecting confidentiality and safeguarding data. Timelines Early Adapters Wave 2 1st Jan 2016 1st Jan 2017 30th Sep 2017 1st Jan 2018 30th Sep 2018 1st Jan 2019 30th Sep 2019 Onboarding for individual and entities starts Remediation for preexisting individual high value accounts complete Multilateral exchange of 2016 information begins Remediation for preexisting individual low value and entity complete Multilateral exchange of 2017 information multilateral exchange of 2018 information Onboarding for individual and entities starts Remediation for preexisting individual high value accounts complete Remediation for preexisting individual low value and entity accounts complete Multilateral exchange of 2018 Key Dates