AEIO reporting for Hong Kong account holder means those who hold an account (or are a controlling person) with Hong Kong Financial Institutions, both individuals and entities, must prepare to report their tax residency information to the Inland Revenue Department (IRD) by May 2018 for exchange with 75 reportable jurisdictions under the Automatic Exchange of Information (AEOI) standard.
Under the AEOI standard, financial institutions in Hong Kong are required to identify financial accounts held by “tax residents of reportable jurisdictions” or held by passive non-financial entities whose controlling persons are tax residents of reportable jurisdictions, in accordance with due diligence procedures.
Determination of Tax Residency
Tax residents of reportable jurisdictions refer to those who are liable to tax by reason of residence in the jurisdictions. In general, whether or not an individual is a tax resident of a jurisdiction is determined by having regard to the person’s physical presence or stay in a place or, in the case of a company, the place of incorporation or the place where the central management and control of the entity is exercised.
Tax residence is determined under the domestic tax laws of each jurisdiction. There might be situations where a person qualifies as a tax resident under the tax residence rules of more than one jurisdiction, and therefore is a tax resident in more than one jurisdiction.
For the purposes of the Common Reporting Standard (CRS), the Account Holder (or Controlling Person) must disclose all its tax residences in the required self-certification.
Time for First Reporting
With the Inland Revenue (Amendment) (No. 2) Ordinance 2017 effective from July 1, 2017, Hong Kong will conduct AEOI with 75 reportable jurisdictions.
These jurisdictions include all EU member states, all of Hong Kong’s tax treaty partners that have committed to CRS, and other jurisdictions that have expressed an interest to the OECD in exchanging CRS information with Hong Kong.
As of July 1, 2017, financial institutions in Hong Kong have been required to collect the information about relevant account holders from these 75 jurisdictions. The first reporting to the IRD will be due in May 2018, in anticipation of exchange with partners.
Contact Us
If you have further inquires, please do not hesitate to contact Tannet at anytime, anywhere by simply visiting Tannet’s website english.tannet-group.com, or calling Hong Kong hotline at 852-27826888 or China hotline at 86-755-82143422, or emailing to tannet-solution@hotmail.com. You are also welcome to visit our office situated in 16/F, Taiyangdao Bldg 2020, Dongmen Rd South, Luohu, Shenzhen, China.
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