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HMRC internal manual

International Exchange of Information Manual

Reportable Information: Reportable Account Holders

Reportable Information: Reportable Account Holders

The different regimes define the Reportable Account Holders in different ways but the objective in each case is the same – to identify whether the Account Holder is linked to the jurisdiction receiving the information in a way that indicates that they may be subject to taxation in that jurisdiction.

FATCA

Under the US IGA, Financial Institutions are required to carry out due diligence procedures to identify Account Holders who are Specified US Persons. A US person is a US citizen or resident individual, a partnership or corporation organised in or under the laws of the United States (or any state thereof) and trusts falling within the jurisdiction of the US courts or where one or more US persons have the authority to control the administration of the trust.

Specified US Persons then include all of these subject to a list of exemptions in Article 1 (gg) of the IGA. This covers corporations, the stock of which is regularly traded on recognised securities markets (and their affiliates), and a number of entities largely mirroring the list of Non-Reporting Financial Institutions [see IEIM400920] specified in the IGA. In addition, certain brokers and dealers in securities, commodities or derivative financial instruments are exempt.

CDOT

The CDOT IGAs also use the concept of specified persons. A specified CDOT person is a person or entity who is resident for tax purposes in Guernsey, Isle of Man, Jersey (the CDs) or Gibraltar (an OT) respectively. Corporations with regularly traded stock (and their affiliates) are exempt as under the FATCA IGA as are locally registered brokers and dealers in securities, commodities or derivative financial instruments, the Non-Reporting Financial Institutions in the IGA and Depository Institutions.

Custodial Institutions, Specified Insurance Companies and Investment Entities (where any of these do not fall within the exemptions above) are not excluded, therefore if any such entities are specified CDOT persons their accounts are reportable.

However any account held by a Financial Institution [see IEIM403360 and IEIM403440] that is not resident in a CDOT jurisdiction is not a Reportable Account.

CRS and DAC

The CRS and the DAC use the concept of a Reportable Person rather than a specified person but the outcome is similar. A Reportable Jurisdiction person (reportable member state person for the DAC) is an individual or entity that is resident under the tax laws of the Reportable Jurisdiction or, for an entity that has no residence for tax purposes, the jurisdiction in which its place of effective management is situated.

Once again any corporations (plus affiliates) with regularly traded stock are excluded as are government entities, international organisations, Central Banks and all Financial Institutions.

One difference arises for brokers and dealers in securities, etc., as these are in scope as reportable persons unless they fall within one of the definitions of Financial Institution [see IEIM400600].