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AEOI: Guidance for account holders of Hong Kong Financial Institutions

What you need to know about the Automatic Exchange of Information (AEOI) if you are an account holder or beneficial owner of a Hong Kong Financial Institution.
What is it?

Last updated: 17 June 2020

What is it?

The Hong Kong Inland Revenue Department (IRD) has legislation in place to facilitate exchanges of information relating to the account holders and beneficial owners of Hong Kong financial institutions with other tax authorities worldwide. 

The primary intention of this legislation is to crack down on tax evasion by non-compliant individuals and entities. If you hold any kind of account with a Hong Kong Financial Institution or if you are a beneficial owner of an entity (such as a company or trust) that is classified as a financial institution, then the legislation will affect you.

About the authors

Allan Wilkinson

+852 3192 7083
wilkinsona@buzzacott.hk
LinkedIn

Virginia Zee

+852 3192 7084
zeev@buzzacott.hk

Last updated: 17 June 2020

What is it?

The Hong Kong Inland Revenue Department (IRD) has legislation in place to facilitate exchanges of information relating to the account holders and beneficial owners of Hong Kong financial institutions with other tax authorities worldwide. 

The primary intention of this legislation is to crack down on tax evasion by non-compliant individuals and entities. If you hold any kind of account with a Hong Kong Financial Institution or if you are a beneficial owner of an entity (such as a company or trust) that is classified as a financial institution, then the legislation will affect you.

Did you know?

Did you know? 

Automatic Exchange of Information is the collective term for the two regimes currently in place in Hong Kong to facilitate the exchange of information with other jurisdictions. They are as follows:

  • FATCA (Foreign Account Tax Compliance Act) facilitates information exchange between the US and participating jurisdictions, including Hong Kong.
  • CRS (Common Reporting Standard) facilitates information exchange between a large number of jurisdictions throughout the world (excluding the US).

These regimes place the burden of compliance on financial institutions, which are required to carry out due diligence procedures on all of their account holders or beneficial owners and report them to the tax authorities.

What should you do?

What should you do?

Self-certification

As part of this process, many account holders (both individuals and entities) will be receiving self-certification forms from the financial institutions they have accounts with. The information that is included in these forms will allow the financial institutions to determine the tax residence and classification of the account holder under the two regimes. 

In many cases, these forms are detailed, complicated and confusing, but the account holder is responsible for completing their own forms. The financial institutions cannot provide legal or tax advice. Therefore, if the account holder has questions about how to complete the forms, they will need to contact a tax adviser.

How we can help

How we can help

We can help account holders prepare their self-certification forms and determine their status under the two tax information exchange regimes. If you need our help, please contact Allan or Virginia, or fill out the form below.

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