- Do you have an NRI Bank Account? Then it might interest you to know that India will now share NRI bank account information under the CRS agreement
- NRI bank account information may soon be accessible to your home country tax authorities
NRIs, PIOs and OCI holders who hold passports of UK, Australia, Canada, Germany and many more countries will shortly have their Indian NRI bank account information made available to the tax authorities of their residence countries. This is a step taken by many nations to stop people from avoiding taxes by hiding their cash in foreign bank records.
First FATCA for the USA – Now CRS for over 80 Countries – Sharing Account holder’s information
- NRIs, PIOs, OCI residents in the United States have probably all understood about the tax information sharing of account holders under the FATCA contract among India and the United States of America.
- Now tax distribution of the Indian government is moving on to another stage, and many more countries whose residents have bank accounts in India may promptly be affected.
- The Government of India has signed the Common Reporting Standard (CRS) agreement which is a global standard for the automatic transfer of information between various countries.
- FATCA affects only USA citizens and residents such as green card holders. However, CRS affects citizens of a large number of nations.
- As of Now, 87 countries had already signed the CRS agreement, and more are supposed to sign on.
- India happens to be one of the signatory countries, and their intended first information exchange is assumed to be September 2017.
NRI Bank Accounts Reporting under CRS
Around every account held by NRIs, OCI, PIO in India will become reportable in CRS agreement. In India Banks have already started sending out letters to their NRI account holders to determine their tax identification numbers for their peoples of own countries.
- NRIs who have any bank account in India may have now heard from their bank.
- Those NRIs, PIOs or OCI who have bank accounts in India but have not yet received a request to present their tax identity numbers, residency status, and citizenship, etc can expect to hear shortly from financial organizations.
- These could be their banks, mutual funds, brokers, Demat participants, insurance companies or other financial Organizations they deal with to give the FATCA/CRS declaration so that they can renew their records and get ready for the expected reporting under the tax agreements to share information.
- In cases where an NRI deals with more than one institution, they may get more than one request for such information.
The FATCA-CRS Form’s that are assigned to NRI bank account holders may differ from bank to bank. However, the information needed will probably be the same for most banks. Contact your bank where your NRI accounts are maintained for more information.
What is account information needed to be listed under CRS?
Some of the information that will be reported about your NRI bank account to your nations tax authorities is as below:
- Country (countries) of tax residence
- Date of birth
- Tax identification number (TIN) (if state issues TINs)
- Account number
- Account balance or value (or the closure of the account)
- Amount of interest, gross proceeds, dividends, and additional payments made or credited to the account (if applicable).
Some nations may require additional information to be reported as per their agreements. For instance, Canada does not require the account holder’s place of birth, but other countries may want this information also to be involved.
Will OCI holders living in India be affected?
- Everyone who holds NRI bank accounts will be affected.
- Moreover, those OCI holders who live in India will also be included in CRS or FATCA reporting.
- You can expect to receive a request soon from the bank where your NRI bank accounts are held, asking you to present your residency details, tax identification numbers, etc.
Type of NRI bank accounts which can be reported
- CRS requires financial institutions to recognize and report account information of all those who are citizens of other nations and also have bank accounts in India.
- All financial accounts held by individuals and things, including bank accounts, brokerage accounts, custodial accounts, mutual funds, annuity contracts (including segregated fund contracts), as well as life insurance policies with the cash value are reportable.
- In a situation, if you have foreign citizenship or are a resident of another country, your account information will be reported to your countries of origin.
When will the transfer of bank account information begin?
Dates may change depending on the country of whose citizenship you hold. Many countries are scheduled to start an exchange of information by September 2017, and some will start by September 2018.