Regional Variations

One of the most challenging aspects of AEoI reporting is tracking and implementing the different requirements for different jurisdictions. Whilst the overall reporting requirements and principals are universal, the key areas of regional difference are;

  • Schemas
  • Method of transmission
  • Number and format of returns
  • Referencing conventions
  • Nil return requirements
  • Deadlines
  • Levels of validation

    • Schemas

      In most cases jurisdictions specify that the standard OECD schema is to be used for CRS reporting and the US FATCA schema for FATCA reporting, however some jurisdictions have developed their own schemas which Financial Institutions are required to use. Examples of jurisdictions which have taken this approach to date are;

      • United Kingdom
      • India
      • Canada
      • Luxembourg
      • South Africa

        • Where jurisdictions specify their own schemas to be used, this provides the tax authority with the ability to introduce their own data fields and validation checks and ensures greater integration with their own systems. It also presents the following additional challenges for Financial Institutions;

          • Additional data items to be captured
          • Implementation of additional data validation checks
          • Modification of report creation processes
          • Different methodologies for processing corrections and amendments
          • Additional message and item referencing conventions

          Method of Transmission

          In most cases tax jurisdictions offer a portal where the Financial Institution's representative or agent logs in and uploads the .XML file, however there are some exceptions to this;

          • Direct submissions to IRS – For model 2 jurisdictions, FATCA submissions to IRS are required to be encrypted and packaged according to the IDES specifications and uploaded to the International Data Exchange Service (IDES) portal.
          • Direct submission APIs – some tax authorities have made available APIs so that Financial Institutions can submit returns directly from their system rather than logging into the web portal and uploading the xml file.

          Number and Format of Returns

          Most jurisdictions require two returns to be submitted for each Financial Institution, one for CRS (containing details of all reportable investors) and a separate US FATCA return (containing details of US reportable accounts).

          There are some notable exceptions to this;

          • Some jurisdictions, notably including the UK and South Africa, accept a single AEOI report which contains details of both FATCA and CRS reportable accounts
          • Some jurisdictions (such as the Cayman Islands) require a separate CRS return file for each jurisdiction for which a Financial Institution has reportable accounts (e.g. a file of all French account holders, a file of all German account holders etc)
          • Some jurisdictions (such as Luxembourg) require a single CRS return but with separate sections within the file for each reportable jurisdiction.
          • Many jurisdictions permit details from multiple Financial Institutions (belonging to the same group) to be combined in a single .XML file

          Referencing Conventions

          Each FATCA or CRS return and each reportable account contained within the return should have a unique reference (often referred to as the Message refs and Doc refs). Some jurisdictions specify with precision the exact format which they require, whereas others simply require the Financial Institution to ensure that it is universally unique.


          Nil Return Requirements

          Some jurisdictions require Financial Institutions to notify where they have no reportable accounts (a nil return) whereas most do not. The format of this nil return also varies between jurisdictions, in some cases it is in .XML format (similar to a return containing reportable accounts) and in other cases no XML file is required but instead the user records the fact that there is nothing to report on the relevant portal.


          Deadlines

          Submission deadlines vary between jurisdictions, some are as early as February or March following the reporting period, most are in June and exceptionally some are as late as July or August. In the early years of FATCA and CRS extensions were granted by some jurisdictions while systems were being established. In 2020 many jurisdictions also deferred submission deadlines due to the global Coronavirus pandemic.


          Levels of Validation

          The level of validation checks on specific data field formats varies between jurisdictions. For example, some jurisdictions require that the City field of the account holder's address is completed in all cases, whereas some do not. Certain jurisdictions may implement additional validation checks based on the expected format of national identification numbers.