The Common Reporting Standard (CRS), developed in response to the G20 request and approved by the OECD Council on 15 July 2014, calls on jurisdictions to obtain information from their financial institutions and automatically exchange that information with other jurisdictions on an annual basis. It sets out the financial account information to be exchanged, the financial institutions required to report, the different types of accounts and taxpayers covered, as well as common due diligence procedures to be followed by financial institutions.
The Standard consists of the following four key parts:
Maintaining the integrity of the CRS
The CRS was designed with a broad scope in terms of the financial information to be reported, the Account Holders subject to reporting and the Financial Institutions required to report, in order to limit the opportunities for taxpayers to circumvent reporting. It also requires that jurisdictions, as part of their effective implementation of the Standard, put in place anti-abuse rules to prevent any practices intended to circumvent the reporting and due diligence procedures.
To further preserve the integrity of the CRS, it is now possible to share information on potential CRS avoidance schemes, including on an anonymous basis. This disclosure facility is part of a wider structured process the OECD has in place to deal with schemes that purport to avoid reporting under the CRS, consisting of the following three pillars: