All about CRS and its impact on UAE bank account holderskwsmedeveloper
Common Reporting Standard, CRS, is a standard for information for Automatic Exchange of Information (AEOI). The authorities are to collect financial institutions’ information and exchange it with other authorities on a yearly basis. This standard of reporting financial institutions’ information was drawn up in 2014 and agreed upon by over 97 countries.
The first implementation was reported in 2017. Later in 2018 it was implemented by many other countries. The purpose of CRS is help combat tax evasion and reduce it. Tax evasion is when tax payment is avoided illegally or is not payed completely.
The CRS system will bring transparency to the financial institutions. Therefore, people and corporations maintaining offshore organizations in order to hide finances or avoid paying tax will be easily identified. They can then be charged for tax evasion and given appropriate punishments.
Impact of CRS on UAE account holders
Authorities in the UAE decided June 30 of every year as the reporting date for its information starting 2018. There are two kinds of people in UAE as per the CRS, the reportable and the non-reportable account holders.
If the account holder is not a UAE resident and has a non-resident account, then the account holder falls under the category of reportable people. Such an account holder will need to provide his or her tax identification number (TIN) in the country that he or she is a valid tax resident.
Similarly, an organization which is a trust, foundation or a partnership for the complete period of accounting the tax is based on, the organization is a passive entity. Passive entities’ accounts are also considered as reportable.
However, if the individual holds citizenship in the UAE and is a resident account holder, he or she will only require to fill and submit the CRS form along with the required documents to their financial institute. Personal and corporate bank accounts in UAE opened by the UAE residents are not reportable. This will act as proof for the individual as a tax resident of UAE who does not have a UAE tax identification number. Therefore the UAE tax resident’s account is not reportable.
Furthermore, if an organization is being managed and operated within the UAE, they are not categorized as reportable accounts.
When an account holder is reportable, the authorities can request for information which includes the name, address, birth date and place, the tax identification number, residency authority, account number and the respective financial institute that is in charge of reporting the account and the information regarding the account balance.
Established to help you
When operating a business, business owners need to be aware of the fact that market trends and any governmental change can affect the operations of businesses. However, forecasting the market trends without prior experience is bound to have inaccurate results. Skills and experience is required in order to enter and operate in an already established market. Therefore, business consultants Dubai such as KWSME have entered the market to help new business owners set up and operate their businesses.
Business Consultants Dubai at the consultancy deal with owners of new business setup in Dubai and entrepreneurs who are interested in opening businesses in the UAE. With the best team available, the company provides consultation and PRO services for their clients, and other support services like product registration. The consultation helps clients understand the different types of business setup in Dubai that they can operate. Moreover, KWS ME helps its clients in visa processing, business registration processes and also helps to open bank account in Dubai. In its bid to help you open bank account in Dubai, the consultancy will provide you with the details of documents required and the prerequisites that need to be met.
There is no time to rest. Make most of the opportunities, call or email us for queries.