CRS - Frequently Asked Questions

Financial Institutions

The CRS regulation aims to combat tax evasion and protect the integrity of global tax systems. Under the CRS regulation foreign financial institutions (FFIs) in participating countries (referred to as participating jurisdictions are obligated to identify tax residents or reportable accounts and perform CRS reporting on an annual basis to the local authority.

What is CRS?

To answer the question what CRS is, we first need to understand the CRS meaning. CRS stands for Common Reporting Standard (CRS). CRS is a global standard developed by the Organisation for Economic Co-operation and Development (OECD) in 2014 for the automatic exchange of financial account information.

CRS was advocated by G20 and currently, 121 countries signed up and are committed to complying with the international standard of the automatic exchanging of information under CRS compliance. Notably, the United States does not participate in CRS, but has their own tax reporting regime called FATCA, which is similar in the type of information to collect and share.

Who Is Reportable Under CRS?

The CRS regulations obligate reporting financial institutions (RFIs) to identify the tax residency of their customers or accounts.

Under the CRS compliance rules, RFIs are required to identify all customers who are tax residents outside of their country or jurisidction, where they hold their accounts or products, and report the required information to the local tax authority.

The local tax authority will then exchange that information with the relevant tax authority where the customer is a tax resident. Each country has their own legislation around what is required to be reported.

Which industries are doing this? Are all banks doing this?

CRS explains that this law is used worldwide and throughout the financial service sector. Most financial institutions within the financial services industry within the participating countries or jurisidctions are required to be compliant with CRS finance laws.

This list of financial institutions with CRS requirements includes traditional banks, digital banks and trading platforms, asset management companies, fund administrators, and some insurance companies.

The OECD has recently proposed that crypto and digital asset exchanges and platforms may also soon be within the scope of CRS. They have also introduced Crypto Asset Reporting Framework (CARF) to capture any other digital asset reporting that would fall outside of CRS.

What information are you asking customers to provide & verify?

Financial institutions need to collect, validate, and store the following information about their customers and accounts. The CRS data collected is dependent on local law requirements of the participating jurisidction or country where the financial institution resides or operates.

This information is typically collected through CRS self-certification forms, including CRS-I, CRS-E and CRS-CP:

• Name
• Country of citizenship (for Individual and Controlling Persons)
• Address
• Place of birth (for Individual and Controlling Persons)
• Date of birth (for Individual and Controlling Persons)
• Country(ies) and jurisidction(s) of tax residence
• Taxpayer identification number(s)
• Place of registration/incorporation (for Entities)
• Entity Type (for Entities)
• Controlling Person Type for certain Entity Types (for Controlling Persons)

Is my customer’s information safe?

TAINA takes information security very seriously demonstrated by our ISO27001 certification status. We continuously test our platform to ensure the highest of security standards are always adhered to, using external consultants to verify its excellence. In addition, all Financial Institution clients of TAINA have in place strict codes of secrecy and security which protect customers' information.

What are the key changes to CRS effective from January 1, 2026?

The OECD published new guidance at the end of 2023 with an aim for financial institutions to collect more information to share with jurisdictional tax authorities. These clarifying amendments include:

• Inclusion of New Financial Products: The definition of Depository Accounts now encompasses electronic money (e-money) and Central Bank Digital Currencies (CBDCs). Entities holding e-money or CBDCs for customers will be classified as Depository Institutions under the CRS and account holders should be classified as having a Specified Electronic Money Product account.

• Expanded Definition of Investment Entities: The definition now includes entities investing in crypto assets:
  • Crypto-asset derivatives are considered Financial Assets
  • Certain assets that qualify both as relevant crypto assets under CARF and as financial assets under the CRS (e.g. shares issued in crypto form), CRS contains an optional provision to switch-off gross proceeds reporting under CRS if such information is reported under CARF.

• New Reporting Requirements: Financial institutions must report additional data elements, such as:
  • Whether the account holder has provided a valid self-certification.
  • If the account is held jointly, how many holders are there.
  • Whether the account is new or pre-existing.
  • The type of account (e.g., Depository Account, Custodial Account, Cash Value Insurance Contract, or Equity and debt Interest).
  • The role of a reportable person holding an equity interest in an investment entity, like a controlling person.

• Excluded Accounts: Capital contribution accounts used temporarily for company setup or capital increases are now classified as Excluded Accounts for up to 12 months, provided safeguards are in place.

• Non-Profit Entities: Genuine non-profit entities can now be categorized as Non-Reporting Financial Institutions, subject to conditions and verification by tax authorities.

For more information of these changes. Please see TAINA’s article which highlights these amendement impacts.

Customers

TAINA’s clients which are financial institutions and need to comply with CRS typically need to answer questions brought forward from account holders. While the self-certification form instructions provide some details, the following are general questions that are still asked by customers filling out the forms.

How is my tax residence defined?

Each jurisdiction committed to automatically exchanging information under the CRS may define tax residence differently. Tax residence is determined by the domestic law of each jurisdiction or country.

Determining your tax residency may also be dependent on an individual or entity's circumstances. For example, there might be situations where a person qualifies as a tax resident under the tax residence rules of more than one jurisdiction and therefore is a tax resident in more than one jurisdiction.

 For more information on the tax residency rules of the participating jurisdictions visit the OECD website.

Why are you asking me for my Jurisdiction(s) of Tax Residency?

Financial Institutions are required to ask existing and new customers for their tax country or jurisdictions and the applicable tax identification numbers for CRS compliance purposes. As part of their CRS reporting, RFIs are obligated to collect CRS self-certification forms which identifies certain information relating to the customer or entity's tax statuses. 

The information I have been asked for on the forms is like FATCA, why is this different?

There are similarities between the Foreign Account Tax Compliance Act (FATCA) and the Common Reporting Standard (CRS).

Although CRS does use a similar approach of automatically exchanging information to combat tax evasion as the FATCA does, they are technically two different regulations with different requirements.

Therefore, even if you have provided similar information to your Financial Institution under FATCA you may still need to provide the same or additional information under CRS.

FATCA is technically a US law which requires foreign financial institutions (FFIs) to identify US persons that hold assets abroad and regularly submit or report this information on these financial accounts in line with the FATCA regulations.

CRS as previously stated above requires RFIs to identify the tax residency of all customers. Under CRS RFIs are then obligated to report information on those customers who are tax residents in countries outside of the country or jurisdiction where their accounts are being held.

I live in the same country/jurisdiction as I pay tax, why do I need to give these details?

As mentioned in a previous question, RFIs are obligated under CRS policy to establish the tax residency of all customers. However, if they find that you are a tax resident in the same country/jurisdiction as where you hold your account, then your information will not be considered CRS data. Thus, your information will not be reported to local or international tax authorities for CRS purposes.

How often will I need to provide this information?

For both the FATCA and CRS regulations, you should only need to provide one valid self-certification form. Once a valid self-certification has been provided, you should only be asked to complete another self-certification form when your details/ information needs to be updated or because your reportable status may have changed.

What information will be reported to tax authorities?

All the information listed above in the CRS self-certification form will be reported to local tax authorities for CRS reporting purposes. In addition to the CRS self-certification forms, other details reported to tax authorities may include the balance or value of the accounts and products or the total amounts of interest or payments credited to you in a calendar year.

Which countries/jurisdictions are participating in CRS?

Over 120 countries have signed up and are committed to complying with the CRS regulation for the automatic exchange of information (AEOI). This list changes every year, as well as the exchange agreements between jurisdictions also changes. To see the full list of participating countries/jurisdictions and the dates for annual CRS reporting please visit the OECD CRS portal.

Where can I find further information and advice?

For more information on the CRS regulations and the CRS obligations of customers and financial institutions please refer to your local tax authorities' guidance or the  OECD Automatic Exchange of Information portal.

Do the new CRS amendments impact anything I need to provide to financial institutions?

The main amendments include new data points which the financial institution needs to collect for reporting to their jurisdiction’s tax authority. The information relates to account details which were gathered during the KYC process, and not necessarily divulged on a self-certification form. An account that was previously deemed not reportable, now can be. It is important for financial institutions to understand the changes these amendments bring, and evaluate their accounts to determine and communicate impacts to their customers.

How can TAINA help Financial Institutions with CRS compliance?

The rise in enforcement and CRS compliance tax authority reviews, paired with the ever-changing legislation around CRS, has further increased the risk for financial institutions. It is more important than ever to address your CRS validation process. The TAINA Platform takes care of your CRS compliance in a seamless end-to-end process whilst maintaining an up to date, robust and detailed CRS ruleset. 

At TAINA we continue to monitor the FATCA and CRS regulatory landscape and will track both IRS and OECD drafts and published updates to the regulations. TAINA’s fully automated FATCA and CRS Validation Platform can help financial institutions of all types lighten their compliance burden and prove their FATCA and CRS compliance whilst improving efficiency, reducing cost, mitigating risk, and improving their overall customer and investor experience.

Using our flexible and lightweight platform you can automate and streamline your FATCA and CRS validation process whilst ensuring you have good year-end data that will result in clean FATCA and CRS reporting to tax authorities.

We would love to talk to you more about your current documentation validation process and how our award-winning FATCA and CRS Validation platform may add value to your organisation.

For more information on how our fully automated FATCA and CRS Validation platform can add value to your business, get in touch or request a demo to see it in action.