Back to Blogs

Taxing times for Trustees?

  • Publish Date: Posted 26 November 2015
  • Author: AP Executive

As the first data exchange under the Common Reporting Standard (CRS) is due soon, financial institutions need to respond to the increased reporting pressures, whilst complying with the set parameters. Based on the USA’s tax law Foreign Account Tax Compliance Act (FATCA), the Common Reporting Standard (CRS) is the product of a global initiative involving 51 jurisdictions to facilitate efficient information exchange between jurisdictions and check tax avoidance.


Here is some advice on how the CRS can be turned into a “business opportunity” instead of an “administrative nightmare”, as it is widely perceived to be.

The Common Reporting Standard (CRS) is nearly upon us, and, quite surprisingly, it is approaching not with a bang, but a whimper. Whereas FATCA and EUSD were shouted from the rooftops, CRS seems to be creeping up with hardly a peep.


These initiatives involve governments obtaining information from their financial institutions and exchanging data automatically with other nations. Financial institutions (and other investment entities) will have significant additional reporting responsibilities, in order to disclose details of their account holders, with potential penalties for those unable or unwilling to comply fully.


Financial reporting will include all income and capital revenues, account balances, portfolio values etc, but whatever information is gathered, its impact is all dependent on the residency, or tax residency, of the individual(s) concerned.


To many Trust Directors, the ever increasing reporting requirements might seem like an additional chargeable administration that eats into WIP and bottom line figures; an additional support service such as compliance that reduces profit margins.


Perhaps though, this is not the way to view things. Depending on whether your glass is half full or half empty, this represents an opportunity to be pro active with your HNW clients.


Whilst many go about their annual review process as a tick box exercise to make sure due diligence and the like is in place, there is now an opportunity to re-assess your clients’ tax situation, and approach them to review their structures and their suitability for purpose. Could you streamline the whole administrative process for your biggest UHNW client? Could you win additional business from them as a result of your greater understanding of reporting requirements? Could you win business through referrals as a result of your pro-activeness?


With the correct guidance, the implementation of CRS could prove to be the biggest business development opportunity that has ever presented itself in many years.


At AP Executive, I am working with candidates having an in-depth subject matter expertise in the CRS and are well-equipped to deliver exceptional tax reporting service to clients.


*This article was written by Kieron Lambert, former Executive Consultant.