These changes means that the details of any UK bank or investment accounts held by a person resident of Russia in 2018, will not be exchanged with the tax authorities in Russia in 2019.

Legal department, Fidelcrest

Automatic Exchange of Information – Russia is no longer reportable

HM Revenue & Customs have released an update which may be of significant interest to you and your non-EU clients, with regards to international tax planning. Further details can be found from https ://www.gov.uk/hmrc-internal- manuals /international-exchange-o f-information/ieim4023 40.

In this letter we will not cover all the changes but the ones that we believe will be of most interest to you.

Overview of the regime

As you may be aware various countries, including the UK, have signed Automatic Exchange of Information agreements whereby the tax authorities of the various countries exchange information about financial accounts and investments of non-resident s. This is known as Common Reporting Standard (CRS) and is aimed to help stop tax evasion.

If a non-UK resident has financial accounts and/or investments in the UK, the bank or investment company will provide information about this to HMRC. This information will then be shared with the country where that person is resident. This is also applicable where the non- UK resident has accounts in the name of a company, branch of a foreign company, partnership or trust.

CRS reporting is carried out on a yearly basis after the end of a given calendar year. If an account have been deemed to be reportable, the account will still be reported even if it is closed during that calendar year, but will not be included in the reporting for subsequent calendar years. For example, reportable accounts that were open for all or part of 2017 will be reported to the local tax authority in 2018.

Please note that the above does not constitute legal advice but it is our interpretation of the changes in the relevant legislations.

  • Antigua and Barbuda
  • Brunei Darussalam
  • Costa Rica
  • Grenada
  • Macao (China)
  • Nigeria
  • Vanuatu

Implications for Russian residents

These changes means that the details of any UK bank or investment accounts held by a person resident of Russia in 2018, will not be exchanged with the tax authorities in Russia in 2019.

However the details of any UK bank or investment accounts held in 2018 by, for example, a resident of Vanuatu, (whether directly or via a UK limited company) will be exchanged with the tax authorities in Vanuatu in 2019.

We therefore recommend reviewing your corporate structures to ensure they are still compliant with this regime. Our co-operating legal office Novasigma will be happy to make any necessary changes to an existing UK legal entity, incorporate a new UK legal entity or provide you with any tax advice or consulting services you may need.