Tax residency
Automatic Exchange of Information (AEOI)
New Zealand is one of many countries that has entered into international agreements and has passed amended legislation to support the automatic exchange of account information between the New Zealand Inland Revenue Department (IRD) and the tax authorities of other participating countries. The aim of these exchanges is to reduce global tax evasion.
There are two reporting types under AEOI that may affect you, the Common Reporting Standard (CRS) and the Foreign Account Tax Compliance Act (FATCA).
Common Reporting Standard (CRS)
The CRS was developed by the OECD to combat global tax evasion. Through changes being made to the Tax Administration Act 1994, the CRS will come into effect in New Zealand on the 1st of July 2017.
The CRS requires certain New Zealand Financial Institutions to collect information about customers and their countries/jurisdictions of tax residence. This information is referred to as a customer’s self-certification.
If a customer is a tax resident of a country other than New Zealand, ASB may be legally obliged to pass on information about them and their financial accounts to the IRD. The IRD may then pass on this information to the relevant overseas tax authorities.
Further information:
To find out more visit the OECD website or the IRD website.
Foreign Account Tax Compliance Act (FATCA)
FATCA is United States (US) legislation that aims to reduce tax evasion by US citizens, US tax residents and certain entities that have bank accounts outside of the US. This is because they are required to report their worldwide income to the United States’ Internal Revenue Service (IRS) whether they live in the US or not.
ASB has a regulatory requirement to comply with FATCA. It is enabled in New Zealand through the Double Tax Agreements (United States of America - FATCA) Order 2014, and two agreements entered into by the governments of New Zealand and the United States of America, being the Intergovernmental Agreement and Memorandum of Understanding.
FATCA requires certain New Zealand Financial Institutions to collect information about their customers’ countries/jurisdictions of citizenship and tax residence. If a customer is deemed a US person, US entity or an entity controlled by US persons ASB may be legally obliged to pass on information about them and their financial accounts to the IRD. The IRD may then pass on this information to the IRS.
Further information:
To find out more visit the IRD website.
How CRS and FATCA may affect you?
All new to ASB customers will be required to provide their self-certification before opening an account. We also require the self-certification of key individuals related to certain entities such as beneficial owners and trustees of trusts.
Existing customers may also be contacted by ASB to confirm their self-certification and/or asked to provide additional documentation to support their self-certification.
When we request this information it is important for customers to respond, whether or not they have foreign tax obligations, as we may be required to share this information with the IRD about customers who have not provided us with the requested information. If a customer does not respond they may be imposed with penalties by the IRD.
For more information call our Customer Verification Services team on 0800 111 373 or +64 9 337 4564 if calling from overseas.
Please note that as a Financial Institution, we are not allowed to give tax advice.
If you are unsure about your tax residency obligations we recommend you visit the IRD website or seek professional advice from an independent tax advisor.
You can also find more information in our customer tax residency brochure.
You can find a simplified Chinese version of the brochure here.
