Understanding the Common Reporting Standard
Common Reporting Standard regulation
Common Reporting Standard (CRS) is standard developed by the OECD in 2014 for the automatic exchange of information between partner countries to fight tax evasion. It applies to each country that has committed to the CRS and transposed it into its law.
France is part of the first wave of participating countries, called "early adopters". This list of countries was supplemented by several other waves in 2017, 2018 and 2019 (list of countries involved in the CRS available via the following link: http://www.oecd.org/tax/automatic-exchange/commitment-and-monitoring-process).
CRS requires Financial Institutions (FIs) located in a country involved in the CRS to identify non-resident clients and report them to their local tax administrations located in a country involved in the CRS.
Societe Generale group’s position regarding CRS
Societe Generale group has complied with CRS regulation in all countries where it operates.
The Group supervises the implementation of CRS within each SG reporting FI located in a country that has recently signed or is committed to signing the CRS in the near future.
In order to promote tax transparency, Societe Generale group also undertakes to fulfil all its obligations towards CRS in accordance with the principles set out in its Group's Tax Code of Conduct.
Consequences of CRS for Societe Generale clients
The implementation of automatic exchange of information is based on the combined action:
- account holders who must declare their tax residence to determine whether or not they are considered as "non-residents" via self-certification in the following cases:
- for any onboarding client,
- for any opening of a new account or subscription of CRS-eligible products for an existing client, provided that there is not already a valid self-certification for this client,
- for any change in circumstances having a tax impact (e.g. change in tax residence or status).
- financial institutions that must report annually to their local tax authority’s "non-resident" clients, their account balances and the financial income they paid to them over the year,
- the tax authorities of the participating countries that transmit this information to the tax authorities of the country of residence for tax purposes of the client who is the subject of this declaration.
Clients who would not provide the documents required by the CRS would be declared as "undocumented" with their local tax authorities and would be subject to sanctions under local law.
FATCA vs. CRS?
FATCA (Foreign Account Tax Compliance Act) is an US extra-territorial regulation (in force since 1 July 2014) that aims to identify and report US taxpayers to the US tax authorities.
CRS aims to identify non-resident clients in Financial Institutions located in participating countries and report them to their local tax authorities.
Please note: the details provided on this page are intended to help understand the CRS requirements and are not intended to serve as tax advice. If you are uncertain of your CRS status or the impact of this regulation, please consult a professional tax advisor.