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Reporting financial institution

The Common Reporting Standard uses reporting financial institution for a financial institution that falls within a jurisdiction's reporting rules and is not classed as non-reporting.

Definition and scope

The OECD's Common Reporting Standard defines a reporting financial institution as a jurisdictional financial institution that is not a non-reporting financial institution. The definition depends on the jurisdiction named in the applicable rule, so the term describes a classification within that framework.[1]

The St. Kitts and Nevis Inland Revenue Department applies the category to a financial institution based there, unless the law classifies it as non-reporting. Entities are assessed through tests addressing entity status, jurisdiction, financial-institution status, and whether an exclusion applies.[4]

Financial-institution types include depository institutions, custodial institutions, investment entities, and specified insurance companies. Entity types listed in the exclusions include government entities, central banks, and some retirement funds.[4]

Duties and account categories

In St. Kitts and Nevis, reporting financial institutions conduct due diligence, identify reportable accounts, report information annually to the Inland Revenue Department, and keep records. The OECD standard links the institution's due diligence to identifying accounts that meet the reportable-account definition.[1][4]

Under the OECD definition, a reportable account is held by one or more reportable persons, or by a passive non-financial entity with at least one controlling person who is a reportable person.[1]

In St. Kitts and Nevis, an account holder's or controlling person's residence in a reportable jurisdiction is checked before reporting. A reportable person is an individual or entity resident for tax purposes in a reportable jurisdiction.[4]

Jurisdiction-specific application

Under the OECD agreement, a financial institution may be resident in a jurisdiction, or may be a branch located there even when the institution itself is not resident there. The applicable definition therefore depends on the jurisdiction and context.[1]

Singapore's tax authority uses the related label Reporting Singaporean Financial Institution and describes registration for specified financial institutions resident in Singapore, excluding an overseas branch, or a Singapore branch of a nonresident financial institution. Some entities are not required to register, including non-reporting institutions and qualifying trustee-documented trusts whose trustee undertakes the trust's due diligence and reporting.[3]

The definition distinguishes the reporting institution from non-reporting institutions, account holders, reportable persons, and reportable accounts. Whether an entity falls within the term turns on its jurisdictional connection, financial-institution classification, and any applicable exclusion.[1][4]

Questions and answers

What does reporting financial institution mean in the CRS?

The OECD defines it as a financial institution of the relevant jurisdiction that is not classified as non-reporting. The exact jurisdictional connection depends on the applicable rule.[1]

Does every financial institution fall into this category?

No. St. Kitts and Nevis excludes institutions classified as non-reporting under its law, and its identification process also checks the entity's jurisdictional and financial-institution status.[4]

What duties do reporting financial institutions have in St. Kitts and Nevis?

Reporting financial institutions in St. Kitts and Nevis conduct due diligence, identify reportable accounts, report annually to the Inland Revenue Department, and keep records.

How is a reporting institution different from a reportable account?

The institution is the financial institution classified under the jurisdiction's rules. A reportable account is a financial account it maintains that meets the CRS account-holder or controlling-person criteria.[1]

Can a branch be within the definition?

Yes. Under the OECD rules, a branch of a nonresident financial institution is included when that branch is located in the relevant jurisdiction. The Singapore authority similarly describes a Singapore branch of a financial institution that is not resident there.[1][3]

What is a non-reporting financial institution?

It is a financial institution that the applicable law classifies outside the reporting-institution category. Excluded classes include government entities and central banks.[1][4]

  • Common Reporting Standard: The Common Reporting Standard sets rules for exchanging financial account information, covering reporting institutions, covered accounts and due diligence.
  • Reportable account: The OECD standard defines a reportable account as held by a reportable person or certain passive entities, and identified through due diligence procedures.
  • Controlling person: The CRS defines controlling persons and explains their role in due diligence and tax residence reporting for trusts, account holders, and reportable accounts.
Sources and data notes
  1. OECD, Standard for Automatic Exchange of Financial Account Information in Tax Matters, Second Edition (Common Reporting Standard and Commentaries). https://www.oecd.org/content/dam/oecd/en/publications/reports/2017/03/standard-for-automatic-exchange-of-financial-account-information-in-tax-matters-second-edition_g1g73eb6/9789264267992-en.pdf. Retrieved .
  2. Revenue Jersey, Government of Jersey, Automatic exchange of tax information: the Common Reporting Standard (CRS). https://www.gov.je/taxesmoney/internationaltaxagreements/igas/pages/commonreportingstandard.aspx. Retrieved .
  3. Inland Revenue Authority of Singapore, CRS Registration and Deregistration. https://www.iras.gov.sg/taxes/international-tax/common-reporting-standard-%28crs%29/crs-registration-and-deregistration. Retrieved .
  4. St. Kitts and Nevis Inland Revenue Department, CRS. https://www.sknird.com/crs/. Retrieved .

Dates in this block record when each source was read for this page.