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Our risk, compliance and governance services ensures that our clients remain aware of their responsibilities towards compliance with regulatory requirements and governance best practices.

 

What is CRS?

  • Common Reporting Standard (CRS) is a commonly used term for Standard for Automatic Exchange of Financial Account Information (AEFAOI) in tax matters
  • Published by Organisation for Economic Co-operation & Development (OECD)
  • Supported by G20 countries
  • Based on Article 6 of the Convention on Mutual Administrative Assistance in Tax Matters which provides a legal framework for its implementation globally
  • Main objective of CRS is to improve tax transparency through information sharing about financial assets of tax residents of a country in other jurisdictions participating in the CRS program

 

Reportable jurisdictions

Reporting jurisdictions represent countries that have signed the OECD agreement to share the information.

  • 55 Jurisdictions to initiate customer identification in 2016 and report under CRS from 2017 (early adopters)
  • 50 Jurisdictions to initiate customer identification in 2017 and report under CRS from 2018

 

Other countries are increasingly signing the agreement and participating in sharing of tax resident information.

 

All jurisdictions that are a part of the agreement need to appoint a competent authority to support the implementation of CRS in their jurisdictions.

 

CRS timeline

  • Effective starting 1 January 2016 for early adopters.
  • Annual reporting requirements exist, starting 2017 for early adopters, and 2018 for others.

 

Impacted entities

CRS impacts all reportable financial institutions:

Reportable financial institutions

  • Depository institutions
  • Custodial institutions
  • Investment entities
  • Specified insurance companies

Non-reporting financial institutions

  • Governmental entities & their pension funds
  • International organisations
  • Central banks
  • Certain retirement funds
  • Qualified credit card issuers
  • Exempt Collective Investment Vehicles
  • Trustee documented trusts
  • Other low-risk financial institutions

Reportable information

Information about reportable persons (individuals and Passive NFEs with non resident status):

  • Name, address, jurisdiction of residence, Tax Identification Number (TIN), date of birth, place of birth
  • Account/customer number
  • Account balance or value of the account
  • Name & identification number of reporting financial institution
  • Gross amount of interest, dividend or other income and the gross proceeds from the sale or redemption of property paid or credited to the custodial account.
  • Total amount of gross interest paid or credited to the depository account during the calendar year
  • Total gross amount paid or credited to the account including the aggregate amount of redemption payments

 

Typical implementation cycle

Implementing CRS at an institution is a complicated and time consuming process requiring a robust and effective management.  The key stages in the implementation cycle include:

  • Applicability assessment
  • Impact assessment
  • Existing customer analysis
  • KYC policies & procedures updates
  • IT systems updates
  • User training
  • Reporting cycle management

 

Our services

Our experienced consultants work seamlessly with our client teams to deliver timely and effective services around:

  1. CRS impact assessment
  2. CRS program implementation management:
  • Review onboarding process
  • Review system changes to onboarding process
  • Review existing CRS indicia customers
  • Prepare policies & procedures
  • Reporting & registration
  • Training

 

Credentials

We have a team consisting of experts in CRS who have worked with institutions across the Middle East, Europe, India, Singapore, Caribbean and the US. Some of our key credentials include:

  • CRS impact assessment studies for 22 financial institutions in Bahrain and the Middle East
  • CRS implementation support for over 12 institutions in Bahrain
  • Conducted a comprehensive trainings in CRS for a number of banks and insurance companies
  • Published a comprehensive guide on how to comply with CRS
Mohammed Ashraf
Senior Director
Ahmed Ayyad
Senior Manager
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