In December 2016, the U.A.E Central Bank mandated that all banks in the country implement 'Common Reporting Standards', an initiative taken by the OECD in which financial institutions around the world come together with a common goal to combat tax evasion and thereby protect the integrity of tax systems.
CRS require that as a bank, we determine whether you (individual or business) are a “tax resident” in any country other than the U.A.E. This will be based on information we already have or may be required to additionally obtain from you. The impact of CRS will depend on factors such as:
If required, you will be contacted directly to ensure all the necessary information is in place to correctly identify your tax residency. It is important to note that if you have multiple relationships with us, you may receive more than one request for information. Should you have questions regarding your tax residency, please refer to the rules governing tax residence published by each national tax authority. If you have any specific questions regarding your tax residency, please contact a professional tax adviser.
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Download FATCA – CRS , self-certification form:
Send the completely filled and signed form at fatca.crs@dib.ae
Convenient way to update your FATCA CRS, digitally, with no branch visit or any paperwork. Simply click the link that is provided in the SMS that you will receive, which will lead you to a secure portal to update your FATCA/CRS related details.
Under the CRS, an Active Entity (typically a business that is a trading entity) is known as an Active Non-Financial Entity (NFE). You must meet any of the following criteria to be an Active NFE:
The Automatic Exchange of Information (AEOI) is a response by national governments to combat tax evasion more widely and effectively. It refers to the process of tax authorities in CRS-participating countries automatically exchanging data on tax residency with other participating countries.
For an Entity that is a legal person, the term Controlling Person means the natural person(s) who
exercises a controlling interest (‘control’) over the Entity.
Determining control will depend on the legal structure of the Entity. Control over an Entity may be
exercised through direct or indirect ownership or if no such person(s) exists, then by any natural
person(s) that otherwise exercises control over the management of the Entity (for example, the senior
managing official of the company).
For companies, Controlling Persons include any natural person that holds directly or indirectly more
than 25 percent of the shares or voting rights of an Entity as a beneficial owner. In some countries
this percentage may be a lower figure.
In the case of a partnership and similar arrangements, Controlling Person means, consistent with “beneficial
owner” in anti-Money Laundering regulations, any natural person who exercises control through
direct or indirect ownership of the capital or profits of the partnership, voting rights in the
partnership, or who otherwise exercises control over the management of the partnership or similar
arrangement.
In the case of a trust (and Entities equivalent to trusts), the term Controlling Persons means the
settlor(s), the trustee(s), the protector(s) (if any), the beneficiary(ies) or class(es) of
beneficiaries, and any other natural person(s) exercising ultimate effective control over the trust.
The Common Reporting Standard (CRS) is a worldwide information-gathering and reporting requirement for
financial institutions, to help fight against tax evasion and protect the integrity of tax systems.
Under the CRS, we are required to determine where you are “tax resident” (this will usually
be where you are liable to pay income or corporate taxes) and give national tax authorities information
on those customers that are tax resident/paying taxes outside the country where they bank. They may then
share this information with the tax authority of the country (or countries) where you are tax resident.
This is defined under the CRS as a legal person or a legal arrangement, such as a corporation, organization, partnership, trust or foundation. An entity will therefore include any customer that holds a business account, product or service with DIB.
A customer that holds a personal account or product with DIB.
The Organization for Economic Co-operation and Development (OECD) is a group of 34 member countries plus the European Commission and Brazil, China, India, Indonesia and South Africa as permanent guests.
Under the CRS, a Passive NFE means any NFE that is not an Active NFE.
An NFE will be deemed a Passive NFE if more than 50% of the NFE’s gross income for the preceding
calendar year or appropriate reporting period is passive income or the assets held by the NFE during the
same period are assets that produce or are held for the production of passive income.
For the purpose of the CRS, passive income* would generally be considered to include the portion of
gross income that consists of:
*Passive income will not include, in the case of an NFE that regularly acts as a dealer in Financial Assets, any income from any transaction entered into in the ordinary course of such dealer’s business as such a dealer.
An Entity is a “Related Entity” of another Entity if either Entity controls the other Entity, or the two Entities are under common control. For this purpose control includes direct or indirect ownership of more than 50 per cent of the vote and value in an Entity.
A completed self-certification form may be used to confirm your tax residency status under the CRS. There are three types of self-certification form: Individuals, Entities and Controlling Persons. For some types of Entity, as well as collecting the Entity self-certification, we may also need to collect a self-certification from the Controlling Persons. This is explained on the Entities and Controlling Persons self-certification forms.
In the absence of a natural person(s) that exercises control of the Entity through ownership interests, the Senior Managing Official can be identified as the Controlling Person(s) of the Entity. The Senior Managing Official of a company is the person who exercises control over the management of the entity.
Your tax residency is the country where you are resident/registered for tax purposes. Each country has
its own rules for defining tax residence. For more information on tax residence, please consult your tax
adviser, or the tax residency pages of the OECD CRS portal.
http://www.oecd.org/tax/automatic-exchange/common-reporting-standard/
The term ‘TIN’ means Taxpayer Identification Number or a functional equivalent in the absence of a TIN. A TIN is a unique combination of letters or numbers assigned by a jurisdiction to an individual or an Entity and used to identify the individual or entity for the purposes of administering the tax laws of such jurisdiction. Further details of acceptable TINs can be found at the following link: http://www.oecd.org/tax/transparency/automaticexchangeofinformation.htm
The term ‘Account Holder’ means the person listed or identified as the holder of a Financial Account. A person, other than a Financial Institution, holding a Financial Account for the benefit of another person as an agent, a custodian, a nominee, a signatory, an investment advisor, an intermediary, or as a legal guardian, is not treated as the Account Holder. In these circumstances that other person is the Account Holder. For example in the case of a parent / child relationship where the parent is acting as a legal guardian, the child is regarded as the Account Holder. With respect to a jointly held account, each joint holder is treated as an Account Holder.
The “Account Holder” is the person listed or identified as the holder of a Financial Account by the Financial Institution that maintains the account. This is regardless of whether such person is a flow-through Entity. Thus, for example, if a trust or an estate is listed as the holder or owner of a Financial Account, the trust or estate is the Account Holder, rather than the trustee or the trust’s owners or beneficiaries. Similarly, if a partnership is listed as the holder or owner of a Financial Account, the partnership is the Account Holder, rather than the partners in the partnership. A person, other than a Financial Institution, holding a Financial Account for the benefit or account of another person as agent, custodian, nominee, signatory, investment advisor, or intermediary, is not treated as holding the account, and such other person is treated as holding the account.
A Financial Account is an account maintained by a Financial Institution and includes: Depository Accounts; Custodial Accounts; Equity and debt interest in certain Investment Entities; Cash Value Insurance Contracts; and Annuity Contracts.
A Participating Jurisdiction means a jurisdiction with which an agreement is in place pursuant to which it will provide the information required on the automatic exchange of financial account information set out in the Common Reporting Standard.
The term ‘Reportable Account’ means an account held by one or more Reportable Persons or by a Passive NFE with one or more Controlling Persons that is a Reportable Person.
A Reportable Jurisdiction is a jurisdiction with which an obligation to provide financial account information is in place.
A Reportable Person is defined as an individual who is tax resident in a Reportable Jurisdiction under the tax laws of that jurisdiction. Dual resident individuals may rely on the tiebreaker rules contained in tax conventions (if applicable) to solve cases of double residence for purposes of determining their residence for tax purposes.
This is any Entity that holds, as a substantial portion of its business, Financial Assets for the account of others. This is where the Entity’s gross income attributable to the holding of Financial Assets and related financial services equals or exceeds 20% of the Entity’s gross income during the shorter of: (1) the three-year period that ends on 31 December (or the final day of a non-calendar year accounting period) prior to the year in which the determination is being made; or (2) the period during which the Entity has been in existence.
Depository Institution
This is any Entity that accepts deposits in the ordinary course of banking or similar business.
Investment Entity includes two types of Entities:
This is a “Custodial Institution”, a “Depository Institution”, an “Investment Entity”, or a “Specified Insurance Company”. Please see the relevant domestic guidance and the CRS for further classification definitions that apply to Financial Institutions.
The term “Investment Entity located in a Non-Participating Jurisdiction and managed by another Financial Institution” means any Entity the gross income of which is primarily attributable to investing, reinvesting, or trading in Financial Assets if the Entity is (1) managed by a Financial Institution and (2) not a Participating Jurisdiction Financial Institution.
An Entity is “managed by” another Entity if the managing Entity performs, either directly or through another service provider on behalf of the managed Entity, any of the activities or operations described in clause (1) above in the definition of ‘Investment Entity’.
An Entity only manages another Entity if it has discretionary authority to manage the other Entity’s assets (either in whole or part). Where an Entity is managed by a mix of Financial Institutions, NFEs or individuals, the Entity is considered to be managed by another Entity that is a Depository Institution, a Custodial Institution, a Specified Insurance Company, or the first type of Investment Entity, if any of the managing Entities is such another Entity.
This is any Financial Institution that is:
This is;
This is an Entity that is tax resident in a Reportable Jurisdiction(s) under the tax laws of such jurisdiction(s) - by reference to local laws in the country where the Entity is established, incorporated or managed. An Entity such as a partnership, limited liability partnership or similar legal arrangement that has no residence for tax purposes shall be treated as resident in the jurisdiction in which its place of effective management is situated. As such if an Entity certifies that it has no residence for tax purposes it should complete the form stating the address of its principal office.
Generally, an Entity will be resident for tax purposes in a jurisdiction if, under the laws of that jurisdiction (including tax conventions), it pays or should be paying tax therein by reason of his domicile, residence, place of management or incorporation, or any other criterion of a similar nature, and not only from sources in that jurisdiction. Dual resident Entities may rely on the tiebreaker rules contained in tax conventions (if applicable) to solve cases of double residence for determining their residence for tax purposes. An Entity such as a partnership, limited liability partnership or similar legal arrangement that has no residence for tax purposes shall be treated as resident in the jurisdiction in which its place of effective management is situated. A trust is treated as resident where one or more of its trustees is resident. For additional information on tax residence, please talk to your tax adviser.
This is any Entity that is an insurance company (or the holding company of an insurance company) that issues, or is obligated to make payments with respect to, a Cash Value Insurance Contract or an Annuity Contract.
The following data may be reported to the Central Bank of UAE:
