What does 1.CRS mean?
CRS(CommonReporting Standard), that is, * * * is the same as the reporting standard. In 20 14, OECD issued "Standard for Automatic Exchange of Financial Account Information" to combat cross-border tax evasion, including "CRS".
Second, what is the difference between CRS and the previous information exchange regulations?
At present, there are more than 3000 agreements to avoid double taxation in the world, most of which contain information exchange clauses. However, these information exchanges are conducted according to the application, not automatically, and tax-related certification materials are required when applying, so their role in practice is very limited. CRS will automatically exchange information without providing a reason.
3. What is the operating mechanism of CRS?
For example, after the adoption of CRS in China and Singapore, a China tax resident has an account in a financial institution in Singapore, then the personal information of the resident and the income from the account will be collected by the financial institution in Singapore, reported to the relevant government departments in Singapore and exchanged with the relevant government departments in China once a year. Theoretically, China tax authorities will know the overseas assets income of China tax residents.
4. What types of overseas institutional accounts are covered by 4.CRS?
Depository institution: various banks or similar institutions that accept deposits.
CustodialInstitution: If the institution holds "financial assets" for others, and the income related to financial assets and services exceeds 20% of the total income, it is in line with CRS's recognition of the custodian institution, and the time premise is the past three years. If the duration of the institution is less than three years, the duration shall prevail.
InvestmentEntity: An institution is recognized as an "investment entity" if its main economic activity (related income exceeds 50% of total income) in the past three years (whichever lasts less than three years) is to carry out one or more of the following businesses for or on behalf of customers.
1, trading money market instruments (checks, bills of exchange, certificates of deposit, derivatives, etc. ); Foreign exchange; Exchange rate, interest rate and index tools; Transferable securities; Commodity futures.
2. Individual and collective portfolio management.
3. To manage the investment of financial assets on behalf of others.
Institutions that are professionally managed by other custodians, deposit institutions, specific insurance companies and the above-mentioned investors agreed in the CRS agreement, and whose income mainly comes from the investment, reinvestment and trading of financial assets, will also be recognized as "investors".
An insurance company or holding company that designates an insurance company to engage in insurance business and annuity business with cash cancellation value.
It should be pointed out that if an investment institution is established in a non-CRS participating country, such an entity should be classified as a "passive non-financial institution". When such institutions are associated with financial institutions in CRS participating countries (for example, holding accounts in banks in CRS participating countries), negative non-financial institutions will be required to provide information of actual controllers.
5. What types of asset information will be exchanged?
deposit account (DA)
Conditional delivery account
Cash value insurance contract
Annuity contract
Holding equity/creditor's rights of financial institutions