CRS is the Common Reporting Standard. A pathetic attempt by the OECD to end bank privacy for all of us.
There are a set of agreements for banks to exchange information about your accounts with the tax authorities in your home country. However like many government policies it is just as likely to cause chaos and confusion and end up with people taking action to defeat it. Here are 10 ways that you can defeat CRS:
1. Bank in a Country that is Not Signed up to CRS
There are still over 100 countries that do not share information under CRS. In Europe, for example Georgia and Armenia will not share information.
Perhaps the most surprising country not part of CRS is the United States. Provided you’re not a US citizen or resident you can have a Company in Wyoming or Delaware and operate it privately without information being automatically exchanged.
2. Move Your Tax Residency to a Tax Haven
If you move your residency to a tax haven your overseas bank will send the information there.
If you are a UK citizen with residency in Monaco and therefore a zero tax rate you will not be too concerned about your bank in Bermuda sending your details to Monaco.
Some jurisdictions, like Hong Kong, will send information to foreign countries but opt not to receive any information on their citizens or residents.
3. Keep Your Money in a Trust
If your money is held in a trust you can avoid exchange of information with a structure where the true beneficiaries remain anonymous.
4. Business Accounts in Existence Before CRS are Excluded
If it is a Company account and it was in existence before 2016 and the balance is less than $250,000 nothing will be exchanged under CRS.
5. The Account Balance is Reported on One Date Every Year
The account balance is only reported at 31st December every year. You could transfer cash out of your account before that date and send it back afterwards. In that case only a zero balance would be reported.
6. Only Shareholders Holding More than 25% of a Company are Disclosed
A structure could be put in place where there are 5 shareholders with 20% each. In that case nothing would be reportable as CRS only applies to those shareholders having more than 25% shareholding.
7. Companies with Operations are Not Disclosed
If your company has an operating business then it is not reported. CRS is only for financial investments. If the Company is operating a real business nothing can be disclosed. It is fairly easy to convince the bank that you have an operating business.
8. Companies Listed on a Stock Exchange are Excluded
If the Company is listed on a recognised stock exchange it is excluded.
9. Get a Taxpayer ID from another Jurisdiction
It is normally easy to get a taxpayer ID from most jurisdictions. After all they all want new customers. You can get a taxpayer ID from either a non CRS country or a country where you don’t mind if they have information from your overseas bank.
As you can see there are many potential ways around CRS. It has to be planned and structured properly though. I am constantly surprised by how few people are even aware of CRS. If you have existing overseas accounts that you’d rather keep private you should take action without delay.
For the best strategies to avoid the miseries of CRS and for full details of the strategies that you can use to bank anywhere, Bullet Proof Asset Protection Report has several chapters dedicated to the loopholes of CRS. The strategies in this report will let you bank in any major jurisdiction, like Singapore or London while keeping your financial affairs confidential from your home country’s tax office. You will find everything you need to know to rearrange your financial life in the new world where financial privacy has been eliminated for most people.