Common Reporting Standard (CRS) has been saved
Common Reporting Standard (CRS)
Deep-dive into CRS complexities
Common Reporting Standard (CRS) is rapidly becoming a new challenge for financial institutions. Take a view on CRS reporting complexities.
To address the new and forthcoming obligations, it will be possible to capitalize – to a large extent – on efforts that have been made in respect of FATCA implementation, although significant differences will need to be taken into consideration (such as the different definitions of de minimis rules, the differences in fund deemed compliant statuses, the different product and exemption definitions, the fact that CRS reporting will be based on tax residence principles, etc.).
The complexity of the Common Reporting Standard (CRS) results from :
- Multiple reporting in context of Common Reporting Standard in case of non-remediated indicia for the same client
- Multiple FATCA and CRS reporting in case a same person (or controlling person of Passive NF(F)E) is Specified US Person and CRS reportable person in one or several jurisdictions
- Several implementation dates of CRS in multiple jurisdictions, that need to be managed within a same group
- Different Common Reporting Standard due diligence cut-off dates between various legal instruments imposing CRS reporting, possibly resulting in repeated due diligence in the same jurisdiction
- Differences between FATCA and CRS principles; CRS reporting volume expected to be substantially increased compared to FATCA
- Possible differences based on EU Administrative Cooperation Directive vs other legal instruments imposing CRS reporting
- Possible link made between CRS and local reporting regimes (such as French IFU)
- Application of national legislation as to amounts and characterisation of reportable payments, unless otherwise foreseen
- Expected application of EUSD Automatic Exchange in Luxembourg during only 1 year