Automatic Exchange of Information in Tax Matters (AEOI)
FAQ - General questions
As a mean to help counter tax evasion on a global level, the OECD and G20 have worked together to develop a global initiative on the Automatic Exchange of Information in Tax Matters (“AEOI”), also known as the “Common Reporting Standard” or “CRS”.
The focus of the AEOI is the exchange of information on a cross-border basis between tax authorities, and will potentially affect all accounts held by non-residents (i.e. the AEOI will affect accounts held by both individuals and entities, including trusts, foundations and partnerships). Where entities are concerned, it is necessary to determine their classification for the AEOI purposes (being either a Financial Institution, Active Non-Financial Entity or Passive Non-Financial Entity), according to strict criteria laid down in the AEOI rules. In some cases, it may be necessary to gather tax information on the Controlling Persons behind the entity.
The AEOI draws upon international anti-money laundering standards, and sets out strict procedures which must be followed by financial institutions in order to gather, and where necessary report, this tax information to partner jurisdictions.
The reporting of information under the AEOI is generally not applicable if you are tax resident in the same country as the Bank (i.e. Switzerland). This does not mean that the Bank does not have an obligation to collect the information, only that the information will not be reported.
As a financial institution, Swissquote Bank Ltd (hereafter referred to as “the Bank” or “we”) is required to gather certain tax information about all of its clients. Where we determine that you are tax resident in a country with which Switzerland has signed an agreement for the AEOI, we will be required to report certain information about your account (see Q11 for further details) to the Swiss Federal Tax Administration (“SFTA”) on an annual basis. The SFTA will then exchange this information with the tax authorities in the jurisdiction(s) where you are tax resident.
This tax information will be exchanged according to a reciprocal agreement between Switzerland and the partner jurisdiction(s). However, you should note that under the AEOI there is no withholding of tax (i.e. the AEOI is purely an information exchange process).
Several countries had committed to implement the AEOI and around 100 jurisdictions have already implemented it, including all major finance centers. Besides, other jurisdictions are still committed to implement the regime in the near future.
A complete list of jurisdictions that have already implemented the AEOI as well as the ones that have committed to do so, together with information on the dates that they started exchanging or they will start exchanging information, is available in the OECD AEOI portal.
For a list of jurisdictions that Switzerland has signed an agreement with for the AEOI, please refer to the Swiss State Secretariat for International Financial Matters SIF website.
The AEOI took effect in Switzerland as of 1 January 2017 and the first reporting took place in 2018 (in relation to the calendar year 2017 information).
All financial institutions – that includes banks, brokers, insurance companies and asset management businesses – in participating jurisdictions are required to comply with the AEOI.
For accounts opened before 1 January 2017 (a "Pre-existing account"), we will review the information already available in the Bank’s records and we will only contact you to request additional information if we are missing certain information or if we have any doubts as to your AEOI jurisdiction. all necessary information is collected from you at the time the account is opened. We will only contact you to request additional information if we are missing certain information or if we have any doubts as to your AEOI jurisdiction.
In principle, since 1 January 2021, accounts can be opened only if a Self-certification including a Tax Identification Number (a “TIN”) is provided. For accounts opened before 1 January 2021, TIN(s) must be provided as well, by any mean.
If your TIN(s) is/are missing, it is very likely that we will ask you to provide us with it/them. Please note that TINs can be added directly in the Profile section of your account, in the dedicated field named “Tax Identification Number (TIN)”, available in the sub-section Tax residence.
As a general rule, accounts can’t be opened without a Self-certification.
If you fail to provide us with your TIN(s), we might be required to block your account after a period of 90 days maximum.
The rules on tax residence are complex, and it is possible to be resident in more than one jurisdiction for tax purposes (although if there is a Double Tax Treaty in place between the respective jurisdictions, this can often determine which jurisdiction you are deemed to be tax resident in).
Please note that the mere ownership of real estate in a jurisdiction (e.g. a holiday home) does not necessarily mean that you are tax resident in that jurisdiction.
Further information of the tax residence rules in all jurisdictions that have committed to the AEOI can be found on the OECD AEOI Portal.
If you are in any doubt as to where you are tax resident, you should contact your tax advisor.
If you are tax resident in a jurisdiction with which Switzerland has signed an agreement for the AEOI (see Q4), then information on your account is exchanged with the tax authorities in your jurisdiction of residence.
If you are resident in a jurisdiction which has committed to implement the AEOI, but with which Switzerland does not yet have an agreement in place for the AEOI, then no information on your account will be exchanged until such time as an agreement is entered into between Switzerland and your jurisdiction of tax residence.
If you are resident in a jurisdiction which has not committed to implement the AEOI, then no information on your account will be exchanged until such time as that jurisdiction commits to implement the AEOI and signs an AEOI agreement with Switzerland.
Where required, the information exchanged under the AEOI includes all of the following:
- in the case of an individual account holder, their name, address, date of birth, and Tax Identification Number;
- in the case of an entity account holder that is not itself a Financial Institution, the name, address and Tax Identification number of the entity, and if the entity is classified as a Passive NFE for the AEOI purposes, the name, address, date of birth and Tax Identification Number for each Controlling Person;
- the account number;
- the name and Tax Identification Number of the Bank;
- the account balance or value at 31 December of each calendar year;
- the gross proceeds generated from the disposal or redemption of assets during the calendar year;
- and the gross amount of all dividends, interest and other amounts paid or credited to the account during each calendar year.
Yes, your account will be reported in the following year, for the current year even if you close it now or later.
Each year, unless you close your account. In this later case, your account will be reported in the following year only.
You are required to inform us immediately of any changes to your circumstances that might have an impact on the information that would be exchanged under the AEOI. For example, this includes (i) any change to your tax residence status, (ii) any change to your Tax Identification Number, and (iii) in the case of an entity, any changes of Controlling Persons or any changes in the tax residence status of any Controlling Persons.
We will use our best endeavors to inform our clients prior to the first occurrence of reporting of their account pursuant to the AEOI.
Yes, you can request a statement detailing the information sent to the SFTA by the Bank. The statement is produced for a fee of CHF 20 and only once the reporting is done which means after 31 July of each year.
The AEOI statement cannot be reconciled to the tax statement or portfolio statement, as the principles used to produce the three different statements are not the same. The AEOI statement represents an indicative value of the client’s assets (i.e. the gross value of assets at the end of the year (i.e.) securities and cash), the gross amount of all sales and redemption and the gross income received during the concerned year) and is used by national tax authorities receiving the information only as an indication of the client’s situation. It can therefore not be used to infer tax amounts to be paid.
Generally, the information exchanged may only be made available to the authorities that are responsible for handling or supervising taxation in the partner jurisdiction where the account holder is resident, and may only be used for tax purposes. In principle, it is prohibited for the receiving partner jurisdiction to forward the information to another jurisdiction, and it must treat the information as confidential.
Data protection and confidentiality are a key part of the AEOI. There are detailed rules which provide for strong data safeguards to be in place before Switzerland enters into an AEOI agreement with a partner jurisdiction. In addition, the tax authorities are not allowed to share the received information with any other local governmental institutions; the information can only be used for tax purposes.
We respect your data privacy. We only disclose your information under the AEOI if we are legally required to do so.
The AEOI regime does not affect the operation of FATCA because the two regimes run simultaneously.
Further information on the AEOI can be found on the following websites:
Swiss State Secretariat for International Financial Matters SIF website
If you have any questions regarding the impact of the AEOI on you, you should contact your tax advisor.