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HMRC internal manual

International Exchange of Information Manual

Due Diligence: Pre-Existing Entity Accounts: Reportable Accounts: Self-Certification: Financial Institutions

Due Diligence: Pre-Existing Entity Accounts: Reportable Accounts: Self-Certifications: Financial Institutions

The Financial Institution may request the Account Holder entity to include its status in the self-certification as either a Financial Institution [see IEIM400600] or a NFE [see IEIM403360]. When requesting this information from an Account Holder the Financial Institution is expected to provide the Account Holder with sufficient information to enable it to determine its status [see IEIM403340].

If the Account Holder entity falls within the definition of a Financial Institution [see IEIM400600] no further review, identification or reporting will normally be required under  the CRS/DAC regimes.

The exception to this is where the Financial Institution is a managed investment entity [see IEIM400760] resident in a jurisdiction that is not a Participating Jurisdiction [see IEIM402340].  In that case the entity is deemed to be a Passive NFE for reporting purposes [see IEIM404040].

Under the FATCA regime, accounts held by Financial Institutions are not reportable if the Financial Institution falls within one of the specific exclusions at Article1 (1) (gg) of the FATCA IGA.  The exception to this is where there is significant non-compliance by a Financial Institution which has not been rectified. In such circumstances the entity will be classified as a Non-Participating Financial Institution.

Where the Financial Institution is a Non-Participating Financial Institution for FATCA, then reports on certain payments made to such entities will be required [see IEIM402360].

Under the CDOT regime, accounts held by Depository Institutions are not reportable.  Accounts held by other types of Financial Institution are reportable if the entity is a specified CDOT person.

When seeking a self-certification from an entity the categories that may be recorded for a Financial Institution for CRS purposes are:

  1. An investment entity as described in subparagraph A(6)(b) of Section VIII of the CRS (a managed investment entity).
  2. Financial Institution other than in 1. above.

For FATCA purposes they are:

  1. Participating Financial Institution.
  2. Non-Participating Financial Institution.

There is no need to differentiate between types of Financial Institution for CDOT purposes.