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Ukrainian with ~100k in a Liechtenstein bank - How to avoid being reported via CRS?

Yes OECD faq sheet itself



See page 3 - Residency Address Test.

I have talked about in in other threads years ago on here. You do not escape CRS just by changing address before end of year....lol.
This is if you give them 2 addresses. However, that is not the case of you explicitly tell them you are now only tax resident in your new country. In that case, it is only reported to the country of residence by the end of the year. Only the facts by the end of the year are shared.

Self-certification is key here. It is even mentioned in the document you shared.
 
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The CRS is reported by the end of the year so he can still change the tax residency and by notifying the bank about it, it would only be forwarded to the new country of residence

Also, only the amount by the end of the year is reported
It will not work.
Proper leaving Ukrainian tax residence it's a time consuming process and if he is 18-60 male because of martial law - impossible at all at the moment.

He could only get one *more* tax residence somewhere and be tax resident of Ukraine and another country at same time. But this step didn't help at all.
 
This is if you give them 2 addresses. However, that is not the case of you explicitly tell them you are now only tax resident in your new country. In that case, it is only reported to the country of residence by the end of the year.

Self-certification is key here. It is even mentioned in the document you shared.

Not true. Banks are required to report based on changes in Indica. They do not simply rely on self certification lol.

I have found link to OECD document. See page 32 B) 2.


You see in Section 3 that if there is a change in circumstances the FI is required to take action when Electronic Record Search shows any indica change and must report to all reportable jurisdictions as per section 3) 4

So how does this work in practice. When you open account at a bank in January and if you do CRS Self Certification and say your tax resident in France then your account will be reported to France as long as there is no other indica showing other countries. Now if at end of year you change address to Dubai then you are required to do another CRS Self Certification again as indica has changed. Both reports are sent as per Section 3) 4.

Each bank has their own implementation i.e N26 has the below for CRS last time I checked. Notice they report even to places you do regular payments to if its a CRS participating country. A change of address at end of year will not save you.

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What does N26 do with my tax information?

The OECD requires certain tax information to be shared by means of the Common Reporting Standard(new tab) (ECR). To carry out our obligations, we must establish which country you’re taxable in. We do this through your tax identification or National Insurance number.

We forward this information via the German Federal Tax Office to tax authorities in other countries if:


  • You live in a ECR participating country.
  • You have a postbox or a second registered address in another ECR participating country.
  • When registering you gave a telephone number belonging to another ECR participating country.
  • You have a standing order, or make regular payments, to an account located in another ECR participating country.
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Not true. Banks are required to report based on changes in Indica. They do not simply rely on self certification lol.

I have found link to OECD document. See page 32 B) 2.


You see in Section 3 that if there is a change in circumstances the FI is required to take action when Electronic Record Search shows any indica change and must report to all reportable jurisdictions as per section 3) 4

So how does this work in practice. When you open account at a bank in January and if you do CRS Self Certification and say your tax resident in France then your account will be reported to France as long as there is no other indica showing other countries. Now if at end of year you change address to Dubai then you are required to do another CRS Self Certification again as indica has changed. Both reports are sent as per Section 3) 4.

Each bank has their own implementation i.e N26 has the below for CRS last time I checked. Notice they report even to places you do regular payments to if its a CRS participating country. A change of address at end of year will not save you.

------

What does N26 do with my tax information?

The OECD requires certain tax information to be shared by means of the Common Reporting Standard(new tab) (ECR). To carry out our obligations, we must establish which country you’re taxable in. We do this through your tax identification or National Insurance number.

We forward this information via the German Federal Tax Office to tax authorities in other countries if:


  • You live in a ECR participating country.
  • You have a postbox or a second registered address in another ECR participating country.
  • When registering you gave a telephone number belonging to another ECR participating country.
  • You have a standing order, or make regular payments, to an account located in another ECR participating country.
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So, literally, I can get a NIF in Portugal and set Portugal as my tax residency while NEVER actually living in Portugal? :rolleyes:
What does Portugal do when it gets this information and realizes that Jafo is not in its residents' database? :rolleyes:
 
So, literally, I can get a NIF in Portugal and set Portugal as my tax residency while NEVER actually living in Portugal? :rolleyes:
What does Portugal do when it gets this information and realizes that Jafo is not in its residents' database? :rolleyes:
This is the thing. The whole CRS thing relies on self-certification. It is a weaker system than most believe
 
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So, literally, I can get a NIF in Portugal and set Portugal as my tax residency while NEVER actually living in Portugal? :rolleyes:
What does Portugal do when it gets this information and realizes that Jafo is not in its residents' database? :rolleyes:
If you have an EU citizenship you can be a tax resident in almost every European country starting with Bulgaria in the South East and ending with Iceland in the North West ;)
 
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So, literally, I can get a NIF in Portugal and set Portugal as my tax residency while NEVER actually living in Portugal? :rolleyes:

Well this is what people are doing with Dubai residency permits i.e obtaining it and not actually living there. Will you get caught? Not likely but this will change in future for sure.

Most countries have specific government provided guidance on how to implement CRS. The strictness varies between countries in how they implement CRS. You can google search to find the CRS guidance for any country your interested in researching

Here in Bahamas our government guidance for FI's is below:


What does Portugal do when it gets this information and realizes that Jafo is not in its residents' database? :rolleyes:

That is down to the tax office to decide. Here in Bahamas it goes straight into /dev/null.


Ok can we get back to topic and helping OP thx. I have already covered CRS reporting in other threads extensively many years ago. You can search my posts if you want to know more.
 
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I have found link to OECD document. See page 32 B) 2.


You see in Section 3 that if there is a change in circumstances the FI is required to take action when Electronic Record Search shows any indica change and must report to all reportable jurisdictions as per section 3) 4
I'm well aware of the "Electronic record search" that you are talking about. However, you missed the fact that these due-diligence procedures fall under the "preexisting accounts" section. The definition of a "preexisting account" is an account that has been opened on or before 31 December 2015. Therefore, your whole explanation for a "newly opened account" is wrong. If you check the information for "New individual accounts", that is, accounts opened after 31 December 2015, you will see no such information about "Electronic record search".

You are also wrong about the fact that banks do not rely on self-certification when there is a change in information. When, for instance, a new address is given, they need to send out a self-certification. If the self-certification fails or is not accepted, according to the same document you linked, the bank has to rely on the previous information of tax residence.

I have heard that some banks might have their own rules so I cannot say you are wrong on that. However, N26 does not seem to have the same information up on their website anymore. May I ask where you found this information?
 
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You are also wrong about the fact that banks do not rely on self-certification when there is a change in information. When, for instance, a new address is given, they need to send out a self-certification. If the self-certification fails or is not accepted, according to the same document you linked, the bank has to rely on the previous information of tax residence.

Read what I wrote below in bold I said already they ask for new form but it is not relied upon when they have indica already. What you are suggesting is bank is overriding Self Certification at end of year with new accepted Self Certification hence ignoring any clear record search done and indica which will show previpus tax residency :rolleyes:. The new OECD website has changed so much I cannot find any more all the guidance notes that made this clear. They have changed the website for the worse and its hard to find anything any more not even the documents with list of signatories to AEOI. But feel free to believe you can just change your address at end of year and fill in a new Self Cert form and CRS reporting will only occur to that new country. You can only live and learn the hardway.

So how does this work in practice. When you open account at a bank in January and if you do CRS Self Certification and say your tax resident in France then your account will be reported to France as long as there is no other indica showing other countries. Now if at end of year you change address to Dubai then you are required to do another CRS Self Certification again as indica has changed. Both reports are sent as per Section 3) 4.

I have heard that some banks might have their own rules so I cannot say you are wrong on that. However, N26 does not seem to have the same information up on their website anymore. May I ask where you found this information?

Was taken directly from N26 website at the time (2021). I made a post about it below in 2021.


Using waybackmachine you can see N26 said it below on their site:



In the same link they have modified its content not sure if this means they ended this practice/changed it or other :confused:.

 
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