The Common Reporting Standard and due diligence in the automatic exchange of financial account information was drawn up by the OECD, incorporated in Council Directive 2014/107/EU of 9 December 2014 amending Directive 2011/16/EU as regards the mandatory automatic exchange of information in the field of taxation and transposed by the law of 18 December 2015 on the Common Reporting Standard (CRS), published in the Mémorial A – No 244 of 24 December 2015.
By 30 June each year, Luxembourg financial institutions are required to report to the Luxembourg tax authorities (Administration des Contributions Directes) personal and financial information for the previous year relating to the accounts of the persons concerned.
Before 30 September each year, the Luxembourg tax authorities will transfer this information to the tax authorities of the customer’s country of residence and to those of the countries in which indicia have been detected without being invalidated by a self-certification (provided the countries identified are countries participating in the exchange).
Today, more than 100 countries are in scope for reporting.
As a Luxembourg financial institution, KBL epb is responsible for determining the tax residence of its customers:
Based on this identification process, each year KBL epb communicates reportable customers and reportable accounts to the Luxembourg tax authorities.
KBL epb contacts all its customers in order to collect the appropriate self-certification.
For the purposes of the CRS regulations, the forms are only to be updated if there is a change in circumstances (change of country of tax residence, change of activity, name, beneficial owner, etc.). The update must be received within a maximum period of 30 days or risk being considered as notifiable in several countries.
A customer who is a natural person is deemed reportable if he is resident in a reportable jurisdiction or has at least one CRS indicia in a reportable jurisdiction other than his country of tax residence:
Consequently, if the person holding the account does not submit a self-certification, KBL epb shall report this person on the basis of the information in its possession (a customer may be reportable in several countries).
A customer who is a legal person is reportable if required by its status (i.e. Passive or an Investment entity in a non-reporting jurisdiction) and if it is incorporated or fiscally resident in a reportable jurisdiction or if it is controlled by a natural person resident in a reportable jurisdiction.
The information reported to the tax authorities will be of a non-financial nature (name, first name, address, date of birth, tax identification number) and of a financial nature (account number, account balance, income paid into the account).
For legal reasons, KBL epb is not authorized to advise you on your tax situation or your CRS status. In order to avoid the most common errors, we invite you to consult the IRS website or contact a professional tax advisor.