100120 – How the Automatic Exchange Legislation Works

The International Tax Compliance Regulations 2015 implement the DAC in the UK and incorporate the previously separate FATCA provisions. The Regulations implementing the UK’s CDOT agreements, the International Tax Compliance (Crown Dependencies and Gibraltar) Regulations 2014 as amended by the International Tax Compliance (Crown Dependencies and Gibraltar) (Amendments) Regulations 2015 work in the same way to bring into effect the obligations that financial institutions have to report details of accounts to HMRC for exchange with other jurisdictions – these Regulations will not be incorporated into the International Tax Compliance Regulations 2015 as it is anticipated that they will be repealed once the UK and its Crown Dependencies and Overseas Territories start to exchange information under the CRS.

Whether the obligations are for the purposes of FATCA, the CDOT IGAs, the CRS or the DAC the basic process is the same:

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Each of these steps is described in the following guidance and the differences in approach under each of the regimes identified.