Automatic Exchange of Information (AEoI)

Please note that this page only provides general and non- exhaustive information, which is subject to amendments and/or additions over time. This page cannot be used as a substitute for official AEoI publications and does not constitute tax or legal advice.

What is the automatic exchange of information?

The automatic exchange of information (AEOI) is a global initiative where countries automatically share financial information about non-residents. The automatic exchange of information is typically facilitated through agreements like the Common Reporting Standard (CRS) developed by the Organisation for Economic Co-operation and Development (OECD).

Financial institutions in participating countries collect information on account holders, including non-residents, and report it to their respective tax authorities. These tax authorities then exchange this information automatically with the tax authorities of other participating countries on an annual basis.

The goal is to enhance transparency and cooperation in tax matters, making it more difficult for individuals and entities to conceal assets or income in offshore accounts. AEOI helps countries enforce tax laws and combat cross-border tax evasion.

Who are the participating countries?

The list of the activated bilateral exchange relationships of participating countries can be viewed on the OECD website. The list of the participating countries, partner countries of Switzerland can be viewed on the Swiss Confederation website. This list is kept regularly up to date and takes precedence over the list of the OECD.

Who is affected by AEoI?

All clients domiciled in reportable jurisdictions are within scope, both individuals as well as entities.

For example: A French client domiciled in one country holds assets in another country. In this case, such a client is potentially subject to AEoI reporting. Please note that only countries that have an AEoI Agreement in force will exchange information.

On the other hand, onshore obligations are not subject to reporting under AEoI, e.g. if clients have assets booked with a financial institution located in their jurisdiction of residence, AEoI reporting is not relevant for such clients with respect to these assets (e.g. a French resident with assets booked in France).

What is the impact of the AEoI for clients?

The AEI standard requires banks to identify and document the AEoI status (i.e. tax residency for individual clients and tax residency as well as the entity type for entity clients) for both new and existing clients.

In the first instance, IG Bank will use information already held, however we may ask our clients to provide and verify the following identification information:

• Name
• Address
• Place of birth* (for individuals)
• Date of birth* (for individuals)
• Country(ies) of tax residence
• Taxpayer identification number(s)*
• Entity type (for entities)

* this does not apply in all countries and is subject to local law requirements.

Once a client has been defined as a Reportable Person under AEoI, the bank needs to report such a client annually to its local tax authorities. Subsequently, local tax authority will exchange this information with the tax authority of the country where the client is tax resident. The information reported to tax authorities includes:

• Identification information (e.g. name of individual or entity client, address, tax residence, TIN)
• Account information (e.g. name of financial institution, account number)
• Financial information (e.g. account balance, profit and loss, total amounts of dividends or interest credited)*

*Note that variations in final amounts may occur due to the different exchange rates and reporting rules applied.

How secure is the exchange of data under AEoI?

Data protection is a key element of AeoI. The OECD has defined detailed rules on confidentiality and data safeguards, which need to be in place both on a legal and operational level to allow a country to apply AeoI. The local tax authorities are not allowed to share the received information with other local governmental institutions. A country can refuse to deliver data to their partner country if the rules defined by the OECD are not met.

How will AEoI affect Swiss banking secrecy?

For Switzerland, the introduction and implementation of AEoI means that banking secrecy for tax purposes will no longer apply to clients based in a country that is subject to AEoI. By contrast, domestic banking confidentiality for clients domiciled in Switzerland will not be affected by the implementation of the new standard.

Can IG Bank advise on a client's situation with respect to AEoI?

The Bank is not allowed to provide legal or tax advice. If you as a client have any questions about the determination of the jurisdiction(s) of residence for tax purposes and the entity classification, please contact a tax or legal advisor.