UAE expats required to disclose tax info beginning January 2017
UAE banks yet to disclose what kind of information is required from customers
A man uses walks out of a Barclays Bank branch in Dubai November 5, 2008. REUTERS/Ahmed Jadallah
The UAE will be collecting tax information from expatriates following the launch of common reporting standard (CRS) to curb cross-border tax evasion and eradicate bank secrecy on tax.
CRS is led by the Overseas Economic Cooperation and Development (OECD), whose members include the UAE, the European Union, India, Canada, Indonesia and Turkey among others. "Tax cheats have nowhere left to hide," OECD Secretary-General Angel Gurria remarked at the international transparency policy's launch.
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CRS requires expats to disclose information on individual bank accounts, interest, dividends or incomes earned outside their home country. As part of this policy, banks in the UAE will begin collecting the required information from next year.
“From the beginning of January 2017, governments will start requiring all banks and other financial institutions to ask customers for information with a view to determining where they are resident for tax purposes,” HSBC stated in a December 8 letter to customers.
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“[The bank] is committed to protecting the integrity of tax systems and preventing financial crime of all types and will fully comply with these new laws. Therefore, from the beginning of 2017 onwards, we will be contacting some of our customers to collect information related to their tax status,” the letter went on to read.
Although banks have not yet disclosed exactly what type of information they will require from their customers; according to Gulf News, they may ask for taxpayer identification or social security/national insurance numbers.
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With offshore tax abuse reportedly costing the United States an annual $100 billion a year, a similar policy, the Foreign Account Tax Compliance Act in the United States (FATCA) aims to track down and monitor tax-delinquent residents overseas. However, the HSBC website says customers who have already provided information under FATCA may still be required to present additional information under CRS as the two legislations are similar but not congruent.
This article originally appeared on Gulf News.
CRS is led by the Overseas Economic Cooperation and Development (OECD), whose members include the UAE, the European Union, India, Canada, Indonesia and Turkey among others. "Tax cheats have nowhere left to hide," OECD Secretary-General Angel Gurria remarked at the international transparency policy's launch.
Revenue cases: Expats’ cases to be decided in 3 hearings
CRS requires expats to disclose information on individual bank accounts, interest, dividends or incomes earned outside their home country. As part of this policy, banks in the UAE will begin collecting the required information from next year.
“From the beginning of January 2017, governments will start requiring all banks and other financial institutions to ask customers for information with a view to determining where they are resident for tax purposes,” HSBC stated in a December 8 letter to customers.
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“[The bank] is committed to protecting the integrity of tax systems and preventing financial crime of all types and will fully comply with these new laws. Therefore, from the beginning of 2017 onwards, we will be contacting some of our customers to collect information related to their tax status,” the letter went on to read.
Although banks have not yet disclosed exactly what type of information they will require from their customers; according to Gulf News, they may ask for taxpayer identification or social security/national insurance numbers.
Bahamas tax haven: Pakistanis named in new leak of offshore files
With offshore tax abuse reportedly costing the United States an annual $100 billion a year, a similar policy, the Foreign Account Tax Compliance Act in the United States (FATCA) aims to track down and monitor tax-delinquent residents overseas. However, the HSBC website says customers who have already provided information under FATCA may still be required to present additional information under CRS as the two legislations are similar but not congruent.
This article originally appeared on Gulf News.