Standard for Automatic Exchange of Financial Account Information in Tax Matters

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Author(s):
OECD
21 July 2014
Pages:
308
ISBN:
9789264216525 (PDF) ;9789264216518(print)
DOI: 
10.1787/9789264216525-en

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The Standard for Automatic Exchange of Financial Account Information, developed by the OECD with G20 countries, represents the international consensus on automatic exchange of financial account information for tax purposes, on a reciprocal basis. Over 60 jurisdictions have committed to implementing the Standard and all financial centres have been called to match those commitments, as of July 2014.

This publication is the first edition of the full version of the Standard for Automatic Exchange of Financial Account Information. It contains the text of the Model Competent Authority Agreement and the Common Reporting Standard, and the Commentaries thereon, as they read on 15 July 2014. It also includes multilateral and nonreciprocal versions of the Model Competent Authority Agreement, the technical modalities and a wider approach to the Common Reporting Standard.

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Expand / Collapse Hide / Show all Abstracts Table of Contents

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  • Foreword

    This is the first edition of the publication entitled Standard for Automatic Exchange of Financial Account Information in Tax Matters.

  • Abbreviations and acronyms
  • Introduction

    As the world has become increasingly globalised it is easier for all taxpayers to make, hold and manage investments through financial institutions outside of their country of residence. Vast amounts of money are kept offshore and go untaxed to the extent that taxpayers fail to comply with tax obligations in their home jurisdiction. Offshore tax evasion is a serious problem for jurisdictions all over the world, OECD and non-OECD, small and large, developing and developed. Countries have a shared interest in maintaining the integrity of their tax systems. Co-operation between tax administrations is critical in the fight against tax evasion and in protecting the integrity of tax systems. A key aspect of that co-operation is exchange of information.

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  • Expand / Collapse Hide / Show all Abstracts Commentaries on the Model Competent Authority Agreement and the Common Reporting Standard

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    • Commentaries on the Model Competent Authority Agreement

      The Model CAA links the CRS and the legal basis for the exchange (such as the Convention on Mutual Administrative Assistance in Tax Matters or a bilateral tax treaty). The Model CAA consists of a preamble and seven sections and provides for the modalities of the exchange to ensure the appropriate flows of the information. The preamble contains representations on domestic reporting and due diligence rules that underpin the exchange of information pursuant to the Model CAA. It also contains representations on confidentiality, safeguards and the existence of the necessary infrastructure for an effective exchange relationship.

    • Commentaries on the Common Reporting Standard

      The CRS contains the reporting and due diligence standards that underpin the automatic exchange of financial account information. An implementing jurisdiction must have rules in place that require financial institutions to report information consistent with the scope of reporting set out in Section I and to follow due diligence procedures consistent with the procedures contained in Sections II through VII of the CRS.

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  • Expand / Collapse Hide / Show all Abstracts Annexes

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    • Multilateral Model Competent Authority Agreement

      This document is a multilateral version of the Model Competent Authority Agreement. The legal basis is Article 6 of the Convention on Mutual Administrative Assistance in Tax Matters which specifically provides that two or more Parties can mutually agree to exchange information automatically. The actual exchange of the information itself will be on a bilateral basis.

    • Nonreciprocal Model Competent Authority Agreement

      There may be situations where the automatic exchange of financial account information does not need to be reciprocal (e.g. because one of the jurisdictions does not have an income tax). In such cases, the information would be sent only by [Jurisdiction A] to [Jurisdiction B], but not by [Jurisdiction B] to [Jurisdiction A].

    • Common Reporting Standard User Guide

      The OECD working with G20 countries has developed a common standard on reporting, due diligence and exchange of financial account information. Under this common standard, jurisdictions obtain from reporting financial institutions and automatically exchange with exchange partners, as appropriate, on an annual basis financial information with respect to all reportable accounts, identified by financial institutions on the basis of common reporting and due diligence rules.

    • Example Questionnaire

      A legal framework must ensure the confidentiality of exchanged tax information and limit its use to appropriate purposes. The two basic components of such a framework are the terms of the applicable treaty, TIEA or other bilateral agreement for the exchange of information, and a jurisdiction’s domestic legislation.

    • Wider Approach to the Common Reporting Standard

      The due diligence procedures in the CRS (in particular the indicia search procedures) are designed to identify Reportable Accounts understood as those of residents in a jurisdiction that is a Reportable Jurisdiction at the moment the due diligence procedures are performed. However, there are good reasons why jurisdictions may wish to go wider and, for instance, extend due diligence procedures to cover all non-residents or residents of jurisdictions with which they have an exchange of information instrument in place. Such an approach could significantly reduce costs for financial institutions because they would not need to perform additional due diligence each time a new jurisdiction joins.

    • Declaration on Automatic Exchange of Information in Tax Matters

      WE, THE MINISTERS AND REPRESENTATIVES of Argentina, Australia, Austria, Belgium, Brazil, Canada, the People’s Republic of China, Chile, Colombia, Costa Rica, the Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, India, Indonesia, Ireland, Israel, Italy, Japan, Korea, Latvia, Lithuania, Luxembourg, Malaysia, Mexico, the Netherlands, New Zealand, Norway, Poland, Portugal, Saudi Arabia, Singapore, the Slovak Republic, Slovenia, South Africa, Spain, Sweden, Switzerland, Turkey, the United Kingdom, the United States and the European Union;

    • Recommendation of the Council on the Standard for Automatic Exchange of Financial Account Information in Tax Matters
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