The Common Reporting Standard ("CRS") are an agreement between countries to automatically share information regarding the income and assets of residents with the goal of preventing tax evasion. The agreement has some similarities to US FATCA. However, the CRS has no U.S. specificities and is standardized to allow all participating countries to use it as-is.
Dutch government has committed itself to implement the CRS in the Dutch national law system, and has done so by including the implementation of both the CRS and Directive 2014/107/EU ("Directive") in the recently passed 2016 Tax Plan. During the legislation progress, a number of questions were answered in parliament and administrative measure were published in draft form, which gives us insight into the scope of the consequences that the implementation might have.
Draft administrative measure
The draft measure contains the identification and reporting provisions for Dutch financial institutions. It is inextricably linked to the Directive as it often refers to it for defining certain concepts. In addition, the OECD Commentary on the CRS applies to this measure.
The CRS makes several distinctions to determine what reporting obligations are applicable. These include a distinction between accounts set up before and after 1 January 2016 and a distinction between accounts held by persons and by entities. Furthermore, the measure prioritises the identification of accounts held by persons which contain a balance of 1 million U.S. dollars or more. These accounts must be identified by 31 December 2016 at the very latest. Other accounts are to be identified in the next year.
Questions in parliament
In response to the questions in parliament, the State Secretary of Finance has given an overview of the information the Dutch tax authorities will be receiving in the context of the CRS project. This includes, but is not limited to, the balance and the gross credited amount of interest and dividends of an account at the end of the calendar year.