What is that CRS/FATCA form and why is my bank telling me to declare that I am a tax resident?

You might be asking the question. “Should I sign it and provide my tax ID?” NO!!

Before we explain why.  This post is not intended for Americans. If you are an American… you can thank your big uncle Sam for those stimulus checks because you ARE a tax resident wherever you go. – I won’t delve into the messed up American laws that Taiwanese banks seem to apply to ALL foreigners…

However, everyone else… chances are that you are NOT a tax resident!

This is asking for your “TAX RESIDENCY” not your Citizenship. However bank staff in Taiwan often don’t have “TAX RESIDENCY” in their limited vocabulary in both Chinese and English which cause this problem.

CRS stands for Common Reporting Standard. Now, I am not going to bore you with the details but it is basically similar to the American FATCA which forces banks to share information with governments of which you have a tax residency.

The problem? You are likely NOT a tax resident of your home country. The banks in Taiwan seem to equate citizenship with tax residency… However, the OECDs own website states that the mere right to reside in a given jurisdiction (on permanent or temporary basis) or the fact of holding citizenship of a given jurisdiction does not automatically mean that a person shall be considered a tax resident in such a jurisdiction or that, upon obtaining residency or citizenship, the tax residency is extinguished in the former jurisdiction(s) of tax residence.”

https://www.oecd.org/tax/automatic-exchange/crs-implementation-and-assistance/tax-residency/

Each country has their own tax residency rules. New Zealand for example counts ALL homeowners as tax residents… Meaning if you own a home there, you should be submitting a New Zealand tax return every year.

To find your own countries tax residency rules, go here.: https://www.oecd.org/tax/automatic-exchange/crs-implementation-and-assistance/tax-residency/

So why is this important…?

If you are making false, declarations on these forms you are opening yourself up to severe criminal penalties. (However unlikely)

There are also a range of other problems such as your home authorities potentially sending you a tax bill.

Both these problems are rare, but they are both real possibilities.

I myself ran into problems when CTBC bank forced me to list Australia as a tax resident on the CRS form. This caused me endless problems with the tax office in Australia asking why I made that declaration and for me to confirm that I’m not a tax resident. However, this ordeal should have never happened and staff need to be better trained.

For those of you who are unsure how to fill out such a form. Click here for a guide. https://livingintw.com/how-to-fill-out-a-crs-fatca-form-in-a-taiwan-bank/

5 thoughts on “What is that CRS/FATCA form and why is my bank telling me to declare that I am a tax resident?

  1. I also had this same problem. I am from NZ and do not have tax residency there. I was also asked to declare that I was a tax resident.

  2. I was forced to sign something like this when I was made to open an account with the Taiwan (UN) Cooperative Bank for work.
    It turned into a three and a half hour arguing match with them where I had to call my boyfriend to come and deal with them before I flew over the counter. They didn’t understand that I am not american! There was no way I wanted to sign it and at the end I signed it just to get out of there.
    Thanks, will definitely keep it handy. ?

    1. Cathay United tried to make me sign a false declaration, which I refused. Then they asked me to sign a waiver for providing conflicting information.

      On the waiver i wrote ‘I haven’t provided conflicting information, your staff don’t know how to do their job.’ All of a sudden the waiver went in the bin and they accepted my declaration

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