International Exchange of Information Manual

IEIM403180 - Due Diligence: New Individual Accounts: Self Certifications: Incorrect or Unreliable

Due Diligence: New Individual Accounts: Self Certifications: Incorrect or Unreliable

A self-certification remains valid unless the Reporting Financial Institution knows, or has reason to know, that the original self-certification is incorrect or unreliable.  This might be the case either at the time a new account is opened by an existing customer, or as a result of a change of circumstances reported by the Account Holder, for example, a change of address.

Whatever the cause, where the Reporting Financial Institution cannot rely on the original self-certification it must obtain either –

1)  a valid self-certification that establishes the residence(s) for tax purposes of the Account Holder, or

2)  a reasonable explanation and documentation (as appropriate) supporting the validity of the original self-certification (and retain a copy or a notation of such explanation and documentation).

A Reporting Financial Institution may have reason to know that a self-certification or Documentary Evidence is unreliable or incorrect. It may have information in its possession that suggest different facts pertaining to the Account Holder than those on the self-certification. This will include the knowledge of the relevant relationship managers. If a reasonably prudent person in the position of the reporting Financial Institution would question the information provided, then that is reason to know that the information may be incorrect or unreliable.

A Reporting Financial Institution also has reason to know that a self-certification or Documentary Evidence is unreliable or incorrect if there is information in the documentation or in the Reporting Financial Institution's account files that conflicts with the person’s claim regarding its status.

Once a Reporting Financial Institution has reason to know that a self-certification is unreliable or incorrect, then it no longer holds a valid self-certification. For the calendar year 2026 and subsequent years, account holders for whom a valid self-certification is not held should be reported as “false” in the “SelfCert”element of the XML schema. 

Standards of knowledge applicable to self-certifications and Documentary Evidence

A Reporting Financial Institution has reason to know that a self-certification provided by a person is unreliable or incorrect if:

• the self-certification is incomplete with respect to any item on the self-certification that is relevant to the claims made by the person,
• the self-certification contains any information that is inconsistent with the person's claim, or
• the Reporting Financial Institution has other account information that is inconsistent with the person's claim.

A Reporting Financial Institution that relies on a service provider to review and maintain a self-certification is considered to know or have reason to know the facts within the knowledge of the service provider.

A Reporting Financial Institution may not rely on Documentary Evidence provided by a person if the Documentary Evidence does not reasonably establish the identity of the person presenting it.

A Reporting Financial Institution may not rely on Documentary Evidence if it contains information that is inconsistent with the person's claim as to its status, the Reporting Financial Institution has other account information that is inconsistent with the person's status, or the Documentary Evidence lacks information necessary to establish the person's status.

A Financial Institution may choose to treat a person as having the same status that it had prior to the change in circumstances until the earlier of 90 calendar days from the date that the self-certification became invalid due to the change in circumstances, the date that the validity of the self-certification is confirmed, or the date that a new self-certification is obtained. This is to give the account holder a reasonable opportunity to confirm the validity of the self-certification or provide a new self-certification. 

For CRS2.0 reporting, in the event that the validity of the self-certification has not been confirmed and no new self-certification has been obtained by the end of the 90-day period, the account holder should be reported as “false” in the “SelfCert” element of the XML schema. 

A Financial Institution may rely on a self-certification without having to inquire into possible changes of circumstances that may affect the validity of the statement, unless it knows or has reason to know that circumstances have changed.

If the Financial Institution cannot obtain a confirmation of the validity of the original self-certification or a valid self-certification during such 90-day period, the Reporting Financial Institution must treat the Account Holder as resident of the jurisdiction in which the Account Holder claimed to be resident in the original self-certification and the jurisdiction in which s/he may be resident as a result of the change in circumstances.

Example 1: 

A Financial Institution has collected a valid self-certification when onboarding a new customer in 2026. The account holder is a Reportable Person, being tax resident in Spain. For the calendar year 2026, the account is reported to Spain as “SelfCert = true”. 

In August 2027 the Financial Institution is advised that the customer has a new address in Germany. It can no longer rely on the existing self-certification and requests confirmation of its validity ora new self-certification from the account holder. The account holder does not respond to the request within 90 days. For the calendar year 2027 the account holder is reportable to both Spain and Germany as “SelfCert = false”. 

Example 2: 

The facts are the same as for example 1, except that the change of circumstances occurs in November 2027.  The 90-day curing period runs over the 31 December year end and a valid self-certification has not been received by the year end. For reporting in respect of the calendar year 2027, the Financial Institution may rely on the Account Holder’s prior status. The account is reportable to Spain as “SelfCert = true”.     

Where the Financial Institution is unable to obtain a self-certification within 90 days of opening the account, and there are no indicia of residence in any jurisdiction other than the UK, then the account is reportable to the USA under FATCA but is not reportable under the CRS.  However 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.

If a self-certification has been obtained and is invalid solely because it is missing a TIN for a CRS Reportable Jurisdiction, and there are no indicia of US tax residence or US citizenship, then the account is not reportable under FATCA.