IEIM403140 - Due Diligence: New Individual Accounts: Self Certifications
Due Diligence: New Individual Accounts: Self Certifications
Upon account opening, the Reporting Financial Institution must obtain a self-certification.
It is expected that Financial Institutions will maintain account opening processes that facilitate collection of a self-certification at the time of the account opening, whether that process is done face-to-face, online or by telephone. There may be circumstances where it is not possible to obtain a self-certification on ‘day one’ of the account opening process, for example where an insurance contract has been assigned from one person to another or in the case where an investor acquires shares in an investment trust on the secondary market and this does not come to the attention of the Financial Institution until after the event.
In such circumstances, the self-certification should be obtained and validated as soon as possible and in any case within a period of 90 days after the Financial Institution has knowledge that a new account has come into existence. This must be in sufficient time for the account to be reported, where the Account Holder is a Reportable Person, for the period in which the Financial Institution identifies the account. Financial institutions must make proper endeavours to obtain the self-certification in these circumstances. Financial institutions likely to be affected by this must have processes and procedures in place to ensure that self-certifications are sought and obtained from such Account Holders.
Format of self-certification
There is no prescribed format for a self-certification but it may, for example, form part of the account opening documentation. Whatever form it takes, it must allow the Reporting Financial Institution to determine the Account Holder’s residence(s) for tax purposes and whether s/he is a US citizen, and confirm the reasonableness of such self-certification based on the information obtained by the Reporting Financial Institution in connection with the opening of the account, including any documentation collected pursuant to AML/KYC procedures.
The self-certification must also include the Account Holder’s tax identification number [see IEIM402040] and, except for FATCA, date of birth [see IEIM402180].
A self-certification must be signed by the Account Holder (or a person authorised to do so for her/him under domestic law), or in the case of an account opened by telephone or the internet the self-certification must be positively affirmed – that is, the Account Holder must confirm the information provided. The self-certification must be dated no earlier than the date the Account Holder received the form; undated self-certifications may be date stamped by the receiving Financial Institution on receipt and that date will be taken as the date of signature. A self-certification is required for all accounts, including those held in the names of minors.
Self-certifications may take a two-stage process so that, if it is established that an Account Holder is a UK tax resident and not tax resident elsewhere or a US citizen, then it will not be necessary to gather further information beyond the first three bullet points below. Otherwise, self-certifications must include all of the following information for the Account Holder –
- name;
- residence address;
- jurisdiction(s) of tax residence – [see IEIM402060];
- TIN with respect to each Reportable Jurisdiction (see above); and
- (except for FATCA) date of birth.
The self-certification does not need to include the place of birth of the Account Holder even where the Reporting Financial Institution is otherwise required to obtain and report it under domestic law [see IEIM402180]. This is because if that information is already required to be reported it will be held by the Financial Institution (and, if held in an electronically searchable form, must then also be reported for CRS).
The self-certification may be pre-populated by the Reporting Financial Institution to include the Account Holder’s information, except for the jurisdiction(s) of residence for tax purposes, to the extent already available in its records. This includes records held in a central on-boarding system available across multiple jurisdictions in which the Financial Institution operates.
The self-certification may be provided in any manner and in any form, for example it can be in paper or electronic format. If the self-certification is provided electronically, the Financial Institution must have systems in place to ensure that the information provided is that of the Account Holder and it must be able to provide a hard copy of all such self-certifications to HMRC on request.
Where an Account Holder provides a paper self-certification a Financial Institution may retain an original, certified copy, or photocopy (including a microfiche, electronic scan, or similar means of electronic storage) of the self-certification. Any documentation that is stored electronically must be made available by the Financial Institution in hard copy form to HMRC upon request.
Where the Financial Institution is unable to obtain any valid self-certification within 90 days of opening the account, the account is reportable for the period until a valid self-certification is obtained. If there are no indicia of residence in any jurisdiction other than the UK, then the account is reportable only to the USA under FATCA. If there are indicia of residence in reportable jurisdictions other than the UK, then the account is also reportable under the CRS to those other jurisdictions.