By Simon O’ Connor, 19th January 2016
On the 18th of December 2015, the Irish Parliament approved the Regulations implementing the OECD Common Reporting Standard (CRS) in Ireland. The CRS regime is the most recent in a series of initiatives aimed at the international automatic exchange of Information (AEOI). In the past few years, there has been a global movement aimed at greater tax transparency and CRS is definitely the most widespread regime to date covering over ninety countries.
CRS in Ireland
From the 1st of January 2016, Financial Institutions in Ireland are obliged to collect and retain information from Account Holders and submit that information to the Irish Revenue Commissioners. Following this the information will then be reported to the appropriate tax authorities, depending on the jurisdiction where the Account Holder is resident.
What are the obligations for Irish Financial Institutions?
All Irish Financial Institutions must confirm the tax residence of all of their new and current Account Holders. If any of the Account Holders in the Financial Institutions are held by a person who is tax resident in a CRS participating country, it is obliged to include those Account Holders in its annual CRS return which must be filed with Irish Revenue by the 30th of June of the tax year.
Will CRS be applicable to Section 110 Companies?
Similar to the FATCA, CRS applies to all Irish Financial Institutions including custodial and depository institutions and also investment entities. Irish regulated investment funds and Section 110 companies would generally be considered Financial Institutions as investment entities and will, therefore, be obliged to comply with the CRS diligence and reporting requirements.
What are the next steps?
Any Irish Financial Institution which believes they may have CRS obligations should confirm their classification for CRS purposes in order to determine if they are applicable. If a Financial Institution does have CRS obligations, they should carry out the necessary due diligence procedures in order to obtain the relevant information on Account Holders.