Tony Delvalle is an Expat and an Independent Financial Adviser that has been living in France for many years.
Here are some of the bullet points Tony has taken from the OECD Brief dated 29th October 2014 which when read in conjunction with France’s new crackdown on Tax Evasion and proposed penalties makes it today even more important than ever that your affaires are structured correctly. Certainly as an Expat we have more reason to make sure that our assets are in the most tax efficient homes and do not fall foul of ever changing tax rulings.
Please contact Tony to discuss if this is of concern to you.
AUTOMATIC EXCHANGE OF INFORMATION Vast amounts of money are kept abroad and go untaxed to the extent that taxpayers fail to comply with tax obligations in their home jurisdictions. Jurisdictions around the world, small and large, developing and developed, OECD and non-OECD, stand united in calling for further action to address the issues of international tax avoidance and evasion. Co-operation between tax administrations is critical in the fight against tax evasion and a key aspect of that co-operation is exchange of information.
A major breakthrough towards more tax transparency was accomplished in 2009 with information exchange upon request becoming the international standard and the restructured Global Forum on Exchange of Information and Transparency for Tax Purposes starting to monitor the implementation of the standard through in-depth peer reviews.
Now, there has been another step change in international tax transparency. On 9 April 2013, the Finance Ministers of France, Germany, Italy, Spain and the UK (the countries that developed the FATCA intergovernmental agreements with the United States) announced their intention to exchange FATCA-type information amongst themselves in addition to exchanging information with the United States. By September 2014, nearly 50 jurisdictions had joined this group and committed to the early adoption of the standard developed by OECD, including a specific and ambitious timetable for doing so.
Following the commitment to establish automatic exchange as the new global standard made by G8 Leaders inJune 2013, the G20 Leaders at their Summit in September 2013 fully endorsed the OECD proposal for a truly global model of automatic exchange and invited the OECD working with G20 countries to present such a new single standard for automatic exchange of information in time for the G20 February 2014 meeting. In February 2014, the G20 Finance Ministers and Central Bank Governors endorsed the global standard for automatic exchange of tax information.
Following approval of the Standard for Automatic Exchange of Financial Information in Tax Matters by the OECD Council on 15 July 2014, the full Standard was endorsed by the G20 Finance Ministers at their meeting in Cairns in September 2014. See the Annex for G8 and G20 statements providing support for the work.3
Furthermore, on 14 October 2014 the 28 Member States of the European Union reached a political agreement on an amended Directive that will implement the new Standard in the EU.
On 29 October 2014, 51 jurisdictions, 38 of which were represented at ministerial level, signed the first ever multilateral competent authority agreement to automatically exchange information under the Standard, based on Article 6 of the Multilateral Convention. The significance of this event was demonstrated by the participation of 38 ministers* in the signing ceremony, the largest gathering of ministers to take joint action to address tax evasion.
The signatories were: Albania, Anguilla, Argentina, Aruba, Austria, Belgium, Bermuda, British Virgin Islands, Cayman Islands, Colombia, Croatia, Curaçao, Cyprus, Czech Republic, Denmark, Estonia, Faroe Islands, Finland, France, Germany, Gibraltar, Greece, Guernsey, Hungary, Iceland, Ireland, Isle of Man, Italy, Jersey, Korea, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Mauritius, Mexico, Montserrat, Netherlands, Norway, Poland, Portugal, Romania, San Marino, Slovak Republic, Slovenia, South Africa, Spain, Sweden, Turks and Caicos Islands, and the United Kingdom.
The Global Forum on Transparency and Exchange of Information for Tax Purposes, which brings together more than 120 countries and jurisdictions, has also collected commitments from its members to implement the new Standard. Through this process over 80 jurisdictions have expressed their commitment to implementing the Standard to specific timetables.
A single global standard for automatic exchange of financial account information
The financial information to be reported with respect to reportable accounts includes all types ofinvestment income (including interest, dividends, income from certain insurance contracts and other similar types of income) but alsoaccount balances andsales proceeds from financial assets.
The financial institutions that are required to report under the CRS do not only includebanks andcustodiansbut also other financial institutions such asbrokers, certain collective investment vehicles and certain insurance companies.
Reportable accounts include accounts held byindividuals andentities (which includes trusts and foundations), and the standard includes a requirement to look through passive entities to report on the individuals that ultimately control these entities.