The Gibraltar Competent Authority has published its list of CRS reportable jurisdictions, as well as some specific guidance related to reporting obligations, due diligence, debt interest, the transition from CDOT, and the XML schema.
Gibraltar currently has agreements to exchange information with 20 countries – 13 of which are early adopters and will commence automatic exchanges this year. Gibraltar’s prior Intergovernmental Agreement with the United Kingdom for AEOI will transition and merge into CRS reporting. Where due diligence has been carried out under the IGA, it will deemed to have been carried out for purposes of CRS and FIs will not be required to report for each regime. The exchanges with respect to 2016 will include the maximum of what is required by the IGA or CRS in that year. With respect to tax year 2017 onward, CRS will be the exclusive standard.
CRS returns must be submitted electronically via the AEOI portal on or before July 31 of the year following the calendar year to which the return relates.
Gibraltar also announced that it will adopt the “wider approach” to due diligence on an optional basis. The wider approach entails the collection of tax residency information on all foreign accounts, rather than solely accounts from reportable jurisdictions. While this information will not be reported to the competent authority, FIs who follow this approach would keep it on hand in the event that those jurisdictions do become reportable.
The guidance also provides a specific definition for the term “debt interest” for purposes of CRS reporting in Gibraltar – “debt interest” refers to the cost of maintaining all forms of debt capital as measured by the amount of interest payments on current obligations.
Gibraltar FIs should utilize the OECD’s CRS XML Schema in order to report accounts to the competent authority.
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About the Author
Tom Hospod is a member of the Tax Research Team for the Direct Tax division at Sovos Compliance, where his main areas of focus are Tax Withholding and Automatic Exchange of Information (AEOI). Prior to Sovos, Tom worked as a legislative aide in the Massachusetts House of Representatives. He also has experience in securities law—focusing on broker-dealer disputes and representing clients in FINRA arbitration. Tom is a member of the Massachusetts Bar, earned his B.A. from Boston College and his J.D. from the University of Miami.More Content by Tom Hospod