Canadian Insights on the Upcoming Common Reporting Standard

June 2017

Executive Summary

With the upcoming implementation of the Organisation for Economic Co-operation and Development (OECD) Common Reporting Standard (CRS) by the Canadian Department of Finance, there are several considerations and key deadlines that may be relevant to your organization. Please note that the following does not constitute tax, legal, or compliance advice, and clients are encouraged to consult with their legal, compliance and tax advisors for specific guidance. In follow-up to our June 2016 paper, “Upcoming Regulatory Changes – 871(m) and the Common Reporting Standard,” this communication provides updated information on the CRS. By way of background, the CRS is intended to be a global standard for the exchange of financial account information, including disclosure of income earned by non-resident individuals and organizations. The purpose of the CRS is to address tax evasion, improve international tax compliance, encourage international tax cooperation, and help governments protect the integrity of their tax systems.

The Government of Canada intends to implement the CRS beginning on July 1, 2017 with the first inter-jurisdictional exchange of information with other tax jurisdictions taking place in 2018. Canada’s Department of Finance notes that as of July 1, 2017, Canadian financial institutions (FIs) will be required to have new account opening procedures in place to identify accounts held by non-residents and will be required to report certain information to the Canada Revenue Agency (CRA).

Update to the Legislative Landscape

The CRA has posted its final guidance on the CRS, as well as self-certification forms on its website. With respect to the final guidance on the CRS, some relevant areas for Canadian financial institutions to pay particular attention to include: Retirement Compensation Arrangements (RCAs), new accounts and closed accounts, Business Number (BN) vs Global Intermediary Identification Number (GIIN), sponsoring entity versus agent, the filing due date, and Foreign Tax Identification Number (TIN).

CIBC Mellon’s CRS Status

As a Canadian financial institution, CIBC Mellon will be required to take action to implement the provisions of the CRS which are applicable to it, as set out by the CRA. CIBC Mellon will be complying with CRS standards and relevant regulatory requirements. It is the responsibility of CIBC Mellon, as a Canadian FI, to complete diligence requirements on each of its account holders for whom it provides custody services, and to identify any reportable accounts to the CRA on an annual basis.

CIBC Mellon does not have a regulatory responsibility to comply with CRS regulations with respect to unitholders of financial institutions for whom CIBC Mellon provides recordkeeping services, in its role as an agent. CIBC Mellon, however, will offer a recordkeeping reporting service offering, similar to its current offering for Foreign Account Tax Compliance Act (FATCA) related purposes, including the collection of new account opening information, and annual reporting to the CRA.

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