On December 29, 2015 on the website of the Maltese Inland Revenue Guidelines for the implementation of the EU Council Directive 2014/107/EU of 9 December 2014 amending Directive 2011/16/EU as regards mandatory automatic exchange of information in the field of taxation (DAC2) in Malta and the Common Reporting Standard (CRS) issued in terms of Article 96(2) of the Income Tax Act (Chapter 123 of the Laws of Malta) were published. With 121 pages the document is extensive.

 

The Guidelines discuss a.o. the following subjects:

·         Abbreviations

·         Introduction

o        Outline of EU Council Directive 2014/107/EU (‘DAC2’)

o        Outline of the Common Reporting Standard (‘CRS’)

o        Implementation of DAC2 and CRS into Maltese legislation

o        Purpose of these Guidelines

o        The reciprocal automatic exchange framework

o        Competent Authority

·         Section I: General reporting requirements

o        Reporting Financial Institutions

§         Financial Institutions

·         Custodial Institution

·         Depository Institution

·         Investment Entity

·         Specified Insurance Company

o        Non-Reporting Malta Financial Institutions

o        Summary of the above

§         Step 1: Is it an Entity?

§         Step 2: Is the Entity in Malta?

§         Step 3: Is the Entity a Financial Institution?

§         Step 4: Is the Entity a Non-Reporting Malta Financial Institution?

o        Registration requirements

o        Information to be collected by the RMFI

§         “Reasonable efforts”

§         Retention of documents

o        Obligations under the Wider Approach

o        Reportable Accounts

§         Financial Account

§         Excluded Account

§         Recap of Section 2.7

§         Reportable Account

·         Section II of Annex I of the Regulations: General Due Diligence Requirements

o        Reportable Account

o        Balance or value of an account

o        Reliance on Service Providers

§         Multiple Service Providers

o        Due diligence procedures

§         Pre-existing Accounts

o        Treatment of Accounts opened at a time prior to AML/KYC requirements

o        Penalties

·         Section III of Annex I of the Regulations: Due Diligence for Pre-existing Individual Accounts

o        Lower Value Accounts

§         Residence Address Test

§         Electronic Indicia Search

§         Special Procedure

§         Curing Procedure

o        High Value Accounts

§         Electronic Record Search

§         Paper Record Search

§         Relationship Manager Inquiry

§         Finding Indicia

o        Additional procedures

o        Timing of review and additional procedures

·         Section IV of Annex I of the Regulations: Due Diligence for New Individual Accounts

o        Self Certification

§         Wording of self-certification

§         Format of self-certification

·         Section V of Annex I of the Regulations: Due Diligence for Pre-existing Entity Accounts

·         Section VI of Annex I of the Regulations: Due Diligence for New Entity Accounts

o        Other definitions and general due diligence rules

§         Timings

§         Service providers

§         Currency translation

·         Treatment of Trusts

o        Basic Features

o        Determining whether the trust is a RMFI or a NFE

o        The treatment of a trust that is a RMFI

o        The treatment of a trust that is a NFE

o        The treatment of a foundation under these Guidelines

·         Reporting

o        Information to be reported

§         RMFI’s obligation to inform Reportable Persons

o        Account closures

o        Timetable for Reporting

§         Reporting Obligations

§         Reporting in respect of 2016 onwards

§         Reporting in respect of 2017 onwards

o        Format for Transmitting Information to the Commissioner for Revenue

o        Penalties for non-submission or inaccurate submission

§         Failure to report

§         Failure to report in a complete and accurate manner

§         Outstanding Penalties

·         Glossary (as per definitions provided in Section VIII of the Regulations)

·         Lists of Jurisdictions

·         Annex I – Specific List of Non-Reporting Financial Institutions

·         Annex II – Specific List of Excluded Accounts

 

Click here to be forwarded to the Guidelines for the implementation of the EU Council Directive 2014/107/EU of 9 December 2014 amending Directive 2011/16/EU as regards mandatory automatic exchange of information in the field of taxation (DAC2) in Malta and the Common Reporting Standard (CRS) issued in terms of Article 96(2) of the Income Tax Act (Chapter 123 of the Laws of Malta) as available on the website of the Maltese Inland Revenue, which will open in a new window.

 

 

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