Current as of June 2017
Effective from 1 July 2017 the new Common Reporting Standard (“CRS”) will apply and many Australian trusts may need to report financial details of their beneficiaries to the ATO. CRS is a global financial information collection, reporting and exchange for foreign tax residents. The information collected will be shared with participating overseas countries (i.e. U.S and U.K). The aim here is to ensure Australian resident financial accounts can be verified with the overseas countries and therefore help to avoid tax evasion. First reporting will be due to the ATO on 31 July 2018 and the financial data will be exchanged with the participating countries on 30 September 2018.
In summary the implications of CRS on your trust are:
- On request by the ATO your trust will be required to provide financial details of the beneficiaries;
- The reporting obligation could be imposed on the trust or the trustees of the trust;
- Not only will the financial details of the beneficiaries go to the ATO, but it will also be shared with other participating countries;
- There is no minimum size or threshold for reporting;
- If the trust or trustee(s) fails to comply there will be penalties imposed by the ATO.
Should you have any questions or would like to know more please do not hesitate to contact us.
This newsletter has been produced by Stanley & Williamson as a service to its clients and associates. The information contained in the newsletter is of general comment only and is not intended to be advice on any particular matter. Before acting on any areas contained in this newsletter, it is imperative you seek specific advice relating to your particular circumstances. Liability limited by a scheme approved under Professional Standards legislation.