Elimination of tax evasion and increasing tax revenue are widely stated objectives of the common reporting standard (CRS) and the Foreign Account Tax Compliance Act (FATCA). However, the modest increase intax revenue in the United States following the introduction of FATCA may confirm an alternative view that the real purpose of FATCA is to allow the U.S. government access to private financial information so it can control the global financial industry. FATCA and the CRS are each designed to, at a minimum, require reporting financial institutions (RFIs) to report information on the interests that reportable persons have inreportable ‘‘financial accounts.’’ The CRS and FATCA have many similarities in their approach to due diligence and reporting requirements. The OECD, the architect of the CRS, intended this so that RFIs could substanitially use the procedures and systems they had begun developing in connection with FATCA.

The CRS has a significantly wider scope than FATCA. FATCA requires reporting with respect to U.S. tax payers who beneficially own financial accounts. The CRS requires reporting for tax residents in CRS ‘‘participating jurisdictions,’’ of which there are now more than 100. Further, the CRS requires reporting on tax residents that control or beneficially own financial accounts. This article explores key differences between FATCA and the CRS from an international privateclient practitioner’s perspective.

Share
Twitter LinkedIn Email Save as PDF
More Publications
23 Jun 2022

Digital Assets in a Crypto Winter

In 2013, IT engineer James Howells was cleaning out his house. He had two identical hard drives: one...

Contributors: James Batten
22 Jun 2022

Bloomberg Tax Country Guide: Bermuda

Bloomberg Tax Country Guides provide overviews of the tax regimes of more than 200 jurisdictions. Th...

Contributors: Ashley Bento
9 Jun 2022

Bermuda’s long-term re/insurance landscape

Bermuda’s long-term re/insurance market has grown considerably in recent years. The island now has...

2 Jun 2022

Provisional Liquidation In Bermuda

Provisional liquidation in Bermuda is a distinctive, flexible regime that operates to support compan...

Contributors: James Batten
23 May 2022

The good life: Bermuda’s new economic pillar

The life sector has moved swiftly from being a new ‘nice-to-have’ in the Bermuda marketplace, to...

5 May 2022

Restructuring of (Re) Insurers during Covid-19

Restructuring involves changing the financial, operational, legal or other structures of a business ...

28 Apr 2022

Assignment, novation or sub-participation of loans             

Transfers of loan portfolios between lending institutions have always been commonplace in the financ...

21 Apr 2022

Defining digital assets in insolvency proceedings

It has been more than a decade since the creation of the first cryptocurrency, bitcoin, yet digital ...

Contributors: James Batten
7 Apr 2022

Funds: filing requirements and Integra

Investment funds registered, authorised or designated under the Investment Funds Act 2006 have ongoi...

5 Apr 2022

Catch a wave: defining the latest startups

A hard market is the traditional trigger for new capacity and new startups on Bermuda, but that’s ...