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Statistics of 2019 CRS data reported by Financial Institutions

The electronic reporting of 2019 financial account information in tax matters (CRS) was completed smoothly on June 30, 2020. According to the statistics provided by the Fiscal Information Agency, Ministry of Finance, 1,662 financial institutions reported data of 37,974 financial accounts, among which 37,697 accounts are Reportable Accounts held or controlled by the tax residents of Australia or Japan (the rest are reported as Undocumented Accounts). The total balance on Dec. 31, 2019 and the total payment of dividends, interest, or other income to those Reportable Accounts are listed below in $NTD:

 

Country

Number of Reportable Accounts

Balance of Reportable Accounts Payment to Reportable Accounts
Australia 8,258 106.0 billion 11.9 billion
Japan 29,439 954.8 billion 1.6 billion
Total 37,697 1,060.8 billion 13.5 billion

 

The Ministry of Finance explains that, the above-mentioned numbers of financial accounts and amounts of balance and payments indicate that Taiwan has close economic, trade, and investment ties with Australia and Japan. The proceeding cooperation in exchange of information in tax matters has substantial meaning, not only increasing international tax transparency effectively, but also fulfilling an obligation to the global society. According to the preliminary analysis by the Ministry of Finance, around 70% of the total balance (1,060.8 billion) belongs to the accounts held by Japanese or Australian companies having actual investment in Taiwan. In addition, since one company, organization, or individual may hold more than one financial account, the total number of 37,697 Reportable Accounts does not represent the number of tax residents of Japan and Australia staying in Taiwan.

 

The Ministry of Finance further explains that, since this is the first year for financial institutions to report CRS information, an initial examination of the reporting data found that some financial institutions misunderstood the necessity of the reporting element’s input type “(Optional) Mandatory.” Those financial institutions might confuse the input type “Optional” with “(Optional) Mandatory” and then miss out to report “(Optional) Mandatory” elements. CRS elements marked as “(Optional) Mandatory” are in principle mandatory for CRS reporting. Only when the laws or regulations prescribe otherwise and the information is not available to the financial institution, such information could be made an exception not required to be reported. For example, Tax identification number (TIN) is one of the “(Optional) Mandatory” elements. For a Reportable Account, financial institutions shall report all tax resident jurisdiction(s) (including Taiwan) and TIN(s) of account holders as well as controlling persons. Only if the requirements set forth in Subparagraph 1 of Paragraph 2 of Article 50 of the “Regulations Governing the Implementation of the Common Standard on Reporting and Due Diligence for Financial Institutions” are met and the financial institution does not have those Preexisting Accounts’ TIN information after performing due diligence procedures by 2019, those data elements may be left blank this year. However, financial institutions are still required to use reasonable efforts to obtain the TIN(s) information by the end of 2021.

 

The Ministry of Finance states that, many countries extended their CRS reporting period due to the effect of COVID-19 pandemic. In order to be well-prepared, in April this year, the Ministry of Finance also added the legal basis of extending the reporting period. Fortunately, since domestic epidemic has come under control, the CRS reporting was completed as scheduled. The Ministry of Finance appreciates that financial institutions are supporting and complying with the policy and the regulations. Starting from July 1, 2020, the National Taxation Bureaus will continually examine the reporting data (including the above-mentioned “(Optional) Mandatory” elements) and assist financial institutions in making corrections in order to improve the quality of the exchange of information. The automatic exchange of financial account information will be carried out in September 2020 with Australia and Japan.

 

The Ministry of Finance emphasizes that, the CRS information exchanged among the international community is for tax authorities to evaluate the risk of tax evasion and select auditing cases accordingly. The relevant tax assessment should be based on the investigated evidence related to tax evasion. The exchanged CRS information is not for tax assessment directly. Honest taxpayers do not need to worry that the CRS information will increase their tax burdens. The Ministry of Finance urges taxpayers to file tax returns and pay taxes according to the tax laws and regulations. If there is any under-reporting of relevant taxes, taxpayers should present their supplementary tax declaration and their payment of taxes as early as possible.

 

Contact person: Ms. Yu- Hsuan Wang, Section Chief.
Contact Number: (02)2322-8183
 

Issued:Dept. of International Fiscal Affairs Release date:2020-07-09 Last updated:2020-07-09 Click times:704