Services

Common Reporting Standard & FATCA 

CRS

The OECD Standard on Automatic Exchange of Financial Account Information (“CRS”) is a global OECD initiative to improve tax transparency; it is supported by over 100 jurisdictions.

On 12 May 2016, Russia signed the Model Competent Authority Agreement, or МСАA,  which facilitates the exchange of  information under CRS. The purpose of the MCAA is to facilitate the exchange of information received from FIs on financial accounts by the competent authorities of MCAA participating jurisdictions.

In order to exchange of information under CRS certain amendments were adopted to Russian tax legislation and, in particular, Resolution of Government of Russian Federation No. 693  “On implementation of the automatic exchange of financial information with competent authorities of foreign jurisdictions (territories)” (“Resolution”). The Resolution establishes procedures to identify clients/ controlling persons/ beneficiaries, provides guidelines on collection of financial information and reporting of such information to the competent authorities.

Actions required
  • Implement identification procedures for new clients, controlling persons and beneficiaries;
  • Due – diligence of pre-existing reportable accounts;
  • Implement monitoring of changes that may affect client’s tax residency;
  • Ensure that support documents are retained and stored;
  • Prepare and file reports to the Russian competent authorities.

Our services
  • Full-scope assistance with implementation of CRS requirements, including development of internal policies, conducting trainings for employees and implementation of identification procedures for new clients, due diligence for pre-existing accounts, monitoring of client status and reporting;
  • Development and updating of CRS compliance policy and internal documents;
  • CRS healthcheck, including review of processes and documents, implemented by FI to identify gaps and development of recommendations/roadmap aimed at improving of the efficiency of CRS process;
  • Digital solution “CRS Classifier” to verify the status provided by the client;
  • Workshops and training materials for client personnel responsible for CRS compliance;
  • Assistance with report preparation and filing;
  • CRS ad hoc advisory services on FATCA, including classification of accounts, client onboarding, request of information, status monitoring, preparation of report and its submission.
CRS
Actions required
  • Determine CRS status upon FIs’ request;
  • Complete self-certification forms;
  • Prepare information/ documents confirming CRS status and tax residency.
Our services
  • Classification of companies for CRS purposes;
  • Assistance with the preparation of information/documents confirming the entity’s CRS status and tax residency upon FIs’ request;
  • Support in liaising with the FI to substantiate the entity’s CRS status and assistance with completion of self-certification forms;
  • Advisory services on disclosure of entity’s information, its controlling persons (in certain cases) and respective financial data.
CRS
Actions required
  • Indicate tax residency data requested by FIs;
  • Submit information/ documents confirming tax residency;
  • Notify FIs on changes in tax residency in a timely manner.
Our services
  • Support in liaising with the FI to substantiate the individual’s CRS status and assistance with completion of self-certification forms;
  • Advisory services on disclosure of individual’s information and respective financial data.
CRS

FATCA

The Foreign Account Tax Compliance Act (FATCA) is a US federal law intended to prevent tax avoidance by US citizens and US residents (entities and individuals). FATCA requires financial institutions around the globe to identify US persons and report information to the US Internal Revenue Service (IRS).

On 28 June 2014 the Federal Law No. 173-FZ  “On specifics of financial transactions with foreign individuals and entities, on amendments to the Russian Code on Administrative Offenses and on rendering certain provisions of Russian regulations null and void” (“Federal Law No. 173-FZ) was adopted. The Federal Law No. 173-FZ  enables Russian FIs to report clients’ information to foreign tax authorities.

FATCA primarily affects FIs that are responsible for collecting, analyzing and reporting. Certain payments made to FIs may be subject to a 30% withholding if FI fails to comply with FATCA requirements. Furthermore, other FIs may refuse to work with FIs that do not comply with FATCA provisions (“NPFFI”).

Also,  FI may refuse to perform the transaction and (or) unilaterally  close the account with clients, individuals and entities, that fail to provide information and disclose substantial owners (under certain circumstances) or refuse to provide consent to transfer of information to the IRS. Also, 30% withholding may be applied to certain payments to such recalcitrant accountholders.

Actions required
  • Register with the IRS portal and obtain Global Intermediary Identification Number (GIIN);
  • Develop FATCA-related internal policies and documents;
  • Implement identification procedures for new clients;
  • Perform due diligence of pre-existing accounts;
  • Prepare and file reports to the Russian competent authorities;
  • Prepare and file reports with the IRS;
  • Complete FATCA-certification.
Our services
  • Registration on the IRS portal to obtain GIIN;
  • Full-scope assistance with implementation of FATCA requirements, including development of internal policies (including those that should be posted on the FI’s official website), conducting trainings for employees and implementation of identification procedures for new clients, due diligence for pre-existing accounts, monitoring of client status and reporting;
  • FATCA healthcheck, including review of processes and documents, implemented by FI to identify gaps and development of recommendations/roadmap aimed at improving of the efficiency of FATCA processes;
  • An automated solution for generating FATCA 8966 XML reports for further filing with the IRS based on an Excel template;
  • Workshops and training materials for FATCA Responsible officers;
  • FATCA ad hoc advisory services, including classification of accounts, client onboarding, request of information, status monitoring, preparation of report and its submission.
FATCA
Actions required
  • Determine FATCA status upon FIs’ request;
  • Complete self-certification forms (including W-8, W-9);
  • Prepare information/ documents confirming FATCA status and tax residency.
Our services
  • Classification of entities for FATCA purposes;
  • Assistance with the preparation of information/documents confirming the entity’s FATCA status and tax residency upon FIs’ request;
  • Support in liaising with the FI to substantiate the entity’s FATCA status and assistance with completion of self-certification forms (including W-8, W-9);
  • Advisory services on disclosure of entity’s information, its controlling persons (in certain cases) and respective financial data.
FATCA
Actions required
  • Indicate tax residency data requested by FIs;
  • Submit information/ documents confirming tax residency;
  • Notify FIs on changes in tax residency in a timely manner.
Our services
  • Support in liaising with the FI to substantiate the individual’s FATCA status and assistance with completion of self-certification forms (including W-8, W-9);
  • Advisory services on disclosure of individual’s information and respective financial data.
FATCA

Key contacts

Oleg Troshin

Oleg Troshin

Director

Oleg specialises in advising Russian and multinational enterprises on the tax implications of cross-border transactions, cash repatriation strategies, development of tax-efficient holding, finance, li... More

Yeldana Nussipakinova

Yeldana Nussipakinova

Manager

Yeldana is a tax manager in the Financial Services Industry Group of the Tax and Legal Department at Deloitte CIS. She has more than eight years of tax consulting experience. Prior to joining Deloitte... More