Through the Circular, CySEC informs the Regulated Entities regarding their legal obligation to identify, maintain and report information to the Cyprus Tax Department, in accordance with the CRS decree 161/2016 (“CRS Decree”), which came into force on 01.01.16.
- The CRS Decree imposes obligations on Cyprus Financial Institutions to identify, maintain and report information about individuals and entities tax resident in another jurisdiction for whom they maintain financial accounts and to report it to the Cyprus Tax Department to the extent that it is reportable under the applicable legislation.
- There are four categories of reporting Financial Institutions under the applicable legislation, as listed below:
- Custodial Institution;
- Depository Institution;
- Investment Entity; and
- Specified Insurance Company.
- Each category of Financial Institution is determined by set criteria. Where an entity does not meet the definition of Financial Institution in any of the categories then it will be classified as Non-Financial Entity (NFE).
- To this extent, if the Financial Institution is resident for tax purposes in Cyprus, then the Cyprus Tax Department will regard the Financial Institution as within the scope of the Cyprus Agreement.
- CySEC hereby advises the Regulated Entities to read the Guidance Notes of May 2017 in order to determine the entity’s status for the various automatic exchanges of information agreements from the tax residence of the entity and comply with the relevant requirements. The Regulated Entities are also encouraged to visit the Tax Department’s website to read more information on the aforementioned.
CySEC’s expects that: The Regulated Entities were encouraged to comply with the above and identify, maintain and report information to the Cyprus Tax Department, by 21.07.17.