The exchange of financial information between tax authorities of different countries is another step in the fight against tax evasion using offshore companies. The possible accession of Ukraine to such an initiative has been actively discussed for the past two years. Family Office, together with Henley & Partners, figured out what awaits Ukrainians who have foreign accounts in the event of such an exchange, and what can be done to optimize taxation in this situation.
The essence of the question: what is the automatic exchange of information
Automatic exchange of information (or Automatic Exchange of Information, AEOI) is an international arrangement system that allows a country to receive information about the financial assets of its tax residents outside the country. The main objective of the exchange, as you might guess, is the fight against tax evasion. Information is exchanged using a number of technical solutions (after all, this kind of data must be reliably protected) and in accordance with the Common Reporting Standard (CRS) developed by the Organization for Economic Cooperation and Development (OECD).
The provisions of the CRS regulate the process of collecting and exchanging information on financial accounts between tax authorities of different countries. Currently, the initiative has been supported by more than 100 countries, including almost all offshore jurisdictions, as well as Britain, Cyprus, Malta and Switzerland, which are popular among Ukrainians. In 2018, 90 of the hundred countries that pledged to begin the automatic exchange of information on financial accounts in 2017 or 2018 did so. A complete list of countries that have activated the exchange of information can be found on the OECD website.
More information and interesting details can be found here -
https://en.wikipedia.org/wiki/Common_Reporting_Standard
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