What is foreign tax resident reporting?
Australia is one of many countries that has committed to new global standards on the automatic exchange of financial account information. This information is required by law to be collected by financial institutions around the world for reporting to tax authorities. Tax authorities will exchange this information to help make sure everyone pays the right amount of tax.
The Australian Government has enacted laws and entered into international agreements. This may affect you as a customer of a financial institution. These laws implement automatic exchange of information (AEOI) with:
- the United States (US) under a system known as the Foreign Account Tax Compliance Act (FATCA) – this is for US citizens and tax residents only and applies from 1 July 2014
- other countries under the Common Reporting Standard (CRS) – the CRS applies to all foreign tax residents from 1 July 2017.
This means Australian financial institutions must identify accounts held by customers who are foreign tax residents or entities connected to foreign tax residents. They must report these accounts to us. We will then report the account information to the foreign tax authorities.
Similarly, overseas financial institutions must identify their Australian tax resident customers and report their accounts through their local tax authorities to us.
If you have an existing account
If you have an existing account, your financial institution may contact you to confirm your country or countries of tax residence. This is to establish whether you have any accounts that need to be reported under the FATCA or the CRS laws.
They may also contact you if their records indicate that you could be a foreign tax resident. This might be because you have provided an address or other information for a country outside Australia.
If you open a new account
From 1 July 2017, your financial institution must ask you to certify your residence for tax purposes if you open a new account. They may ask you to provide forms and documentation. This will apply for most types of financial accounts.
If you are a foreign tax resident, you will need to provide your tax identification number (TIN) or equivalent. This is the number used to identify you to the tax authority in the foreign country. If you don’t have one, you will be asked to provide a reason.
Accounts held by entities (such as companies, trusts, partnerships, associations)
From 1 July 2017, if you are opening a new account on behalf of a legal entity or arrangement (such as a trust, partnership, company or association) your financial institution must obtain information from you about:
- the tax residence of the entity
- the nature of the entity’s business
- in some circumstances, the individuals who control or beneficially own the entity or have specific connections to the entity, this includes their tax residency and their TIN or equivalent if they are a tax resident outside Australia.
Your financial institution may also contact you for this information for your existing accounts. This will help them comply with their obligations under the FATCA and the CRS laws.
What you need to do
It is important that you respond if your financial institution contacts you to request information. If you don’t respond, they may have to treat you as if you are a tax resident in a country outside Australia, even if you are not.
If you intend to open a new account and do not provide the relevant details, the financial institution will not open the account for you. These requirements help ensure the AEOI laws worldwide are effective. They increase tax transparency by identifying people who have offshore accounts and investments.
False and misleading penalties may apply
You should respond truthfully and to the best of your knowledge when you state your tax residency or provide other information including your TIN to your financial institution. Penalties may apply if you deliberately or recklessly provide false or misleading information.
What happens with your information
If you are a foreign tax resident under the AEOI laws, your identity details, account balance and other information will be provided to us. We will also receive your information if you were identified as a possible foreign tax resident and you didn’t respond to requests for further information. We will then send your information to the tax authority in the country of your tax residency.
If you are an Australian tax resident and you have an account in a financial institution overseas, we will receive your information from the tax authority of that jurisdiction.
All information reported under these laws is handled in the strictest confidence by the ATO and foreign tax authorities. National laws, administrative practices, and binding international treaties protect your information. This is in the same way that all taxpayer information is generally handled.
Foreign tax information
If you have some connection to a foreign country, the following may help you complete forms given to you by your financial institution:
Tax residency
In considering whether you are a tax resident of a country other than Australia, a useful resource is the compilation of rules governing tax residency for other countries on the OECD's Automatic Exchange PortalExternal Link.
If tax residency information for a specific country is not available from this link, or you need more information for a country, you should contact the tax authority of that country.
Tax identification number
If you are a tax resident of a country other than Australia, you will be asked for your tax identification numberExternal Link (TIN) issued to you in that country, if one has been issued to you. TIN is an international term which may have a different name in some countries. If you don’t have a TIN or equivalent, you will be asked to provide a reason.
Foreign tax authorities
Following are the TIN equivalents and the names of tax authorities for some countries. For a more complete list of countries currently participating in the Automatic Exchange of Information, see the OECD's Automatic Exchange PortalExternal Link.
|
Country |
TIN or equivalent for individuals |
Tax authority |
|---|---|---|
|
Brazil |
Cadastro de Pessoas Físicas (CPF) |
Receita Federal |
|
Canada |
Social Insurance Number (SIN) |
Canada Revenue Agency |
|
China |
Tax Identification Number (TIN) or Chinese ID card number |
State Administration of Taxation |
|
Colombia |
Tax Identification Number (TIN) |
Dirección de Impuestos y Aduanas Nacionales (DIAN) |
|
Germany |
Tax identification number (TIN) |
Federal Central Tax Office |
|
Hong Kong |
Hong Kong Identity Card (HKID) number |
Inland Revenue Department |
|
India |
Permanent Account Number (PAN) |
Income Tax Department |
|
Indonesia |
Nomor Pokok Wajib Pajak (NPWP) |
Direktorat Jenderal Pajak |
|
Ireland |
Personal Public Service Number (PPS No) |
Irish Tax and Customs |
|
Japan |
Individual Number |
National Tax Agency |
|
Malaysia |
Tax Identification Number (TIN) or Nombor Pengenalan Cukai. |
Inland Revenue Board of Malaysia |
|
New Zealand |
IRD number |
Inland Revenue |
|
Pakistan |
National Tax Number |
Federal Board of Revenue |
|
Singapore |
Tax Reference Number |
Inland Revenue Authority of Singapore |
|
South Africa |
Tax reference number |
South African Revenue Service |
|
South Korea |
Resident Registration Number |
National Tax Service |
|
UK |
National Insurance Number (NINO) or unique taxpayer reference (UTR) |
His Majesty's Revenue and Customs |
|
United States of America |
Social Security Number (SSN), Employer Identification Number (EIN) or Individual Taxpayer Identification Number (ITIN) |
Internal Revenue Service |
Disclaimer
This information is to help you understand your and your financial institution’s obligations under the AEOI laws. It does not constitute a ruling or binding legal advice. If you have questions about your tax residence status, you should contact the ATO or the tax authority of your country of residence, as applicable, or seek advice from a tax agent or advisor.