What is the purpose of Common Reporting Standard?
Why was the Common Reporting Standard introduced and what was its intended purpose?
Originally introduced in 2017 the Common Reporting Standard (CRS) was created primarily to determine the financial information that must be shared with regards to assets and taxable amounts held by an individual in multiple countries.
The objective of establishing the Common Reporting Standard was to reduce and ultimately look to eliminate tax evasion by requiring financial institutions to automatically share information with the tax authorities in each country.
Gradually more countries are signing up to the Common Reporting Standard and through the Automatic Exchange of Information defined within the CRS, people who have assets overseas should anticipate that the overseas jurisdiction will automatically share financial information with their country of tax residence to allow them to check it has been properly disclosed.
It is important to speak to an international tax specialist to ensure that your tax declarations are up to date and avoid potential penalties that may be incurred if you are found to have not been correctly filing your taxes.
