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  • Common Reporting Standard – information for tax agents

    What is the Common Reporting Standard

    The Common Reporting Standard (CRS) is the single global standard for the collection, reporting and exchange of financial account information on foreign tax residents. Under it, banks and other financial institutions will collect and report to us financial account information on non-residents. We will exchange this information with the participating foreign tax authorities of those non-residents.

    In return, we will receive financial account information on Australian residents from other countries' tax authorities. This will help ensure that Australian residents with financial accounts in other countries are complying with Australian tax law and act as a deterrent to tax evasion.

    Who does CRS apply to

    The CRS applies to foreign tax residents and to financial accounts held by entities (such as companies, trusts, partnerships and associations). If an individual controls or beneficially owns an entity or has a specific connection to the entity then they may be identified and reported in connection with the entity's financial accounts.

    How does it affect financial institutions

    Financial institutions such as banks and other deposit taking institutions, custodial institutions, investment entities, and specified insurance companies are required to report under the CRS.

    What do you need to do?

    You should ensure your clients accurately disclose their offshore assets and foreign source income. If you have foreign source income that you have not disclosed, you will be liable to penalties and interest charges.

    Ensure your clients accurately report all foreign source income. If you have clients who are Australian tax residents and have an account with a financial institution overseas, we will receive their information from the tax authority of that jurisdiction.

    What this means for your clients

    Australia is one of many countries that has committed to new global standards on the automatic exchange of financial account information. This information is required by law to be collected by financial institutions around the world for reporting to tax authorities. It is then automatically exchanged with us each year. The exchange of this information helps make sure everyone pays the right amount of tax.

    In September 2018 we received the first round of data from foreign jurisdictions. The data contains information on financial accounts held by Australian tax residents and entities overseas. Financial accounts that will be reported to us include:

    • depository accounts
    • custodial accounts
    • debt or equity accounts
    • cash value insurance and annuity contract accounts.

    The data will contain details about each financial account including:

    • the account balance
    • interest payments
    • dividend payments
    • proceeds from the sale of assets
    • other income.

    Guidance material

    More information

    If you have further questions regarding the CRS please contact the CRS Project Team.

    Disclaimer

    This information is to help you and your clients understand their obligations under the AEOI laws. It does not constitute a ruling or binding legal advice. For more information go to www.ato.gov.au/CRS.

      Last modified: 30 May 2018QC 55782