Automatic Exchange of Information (AEOI) and Common Reporting Standard (CRS)
AEOI is a process for exchange of information which requires a country to obtain financial information (such as depository account, custodial account and equity interest) from their financial institutions and exchange that financial information automatically on annual basis to treaty partners. The objective of AEOI is to detect and deter any tax evasion by taxpayers through the use of offshore bank accounts.
Common Reporting Standard (CRS) is an internationally agreed standard for the automatic exchange of financial account information between jurisdictions for tax purposes developed by Organisation for Economic Cooperation and Development (OECD). The CRS sets out the rules and procedures for AEOI and the types of reportable person, reportable account and financial information required to be reported by the financial institutions. The CRS also details out the financial account information to be exchanged, the financial institutions required to report, the different types of accounts and taxpayers covered, as well as the customer due diligence procedures to be followed by the abovementioned financial institutions. More than 100 jurisdictions have endorsed CRS and have committed to start implementation of AEOI in either 2017 or 2018.
Brunei Darussalam committed to implement CRS AEOI starting 2018 onwards. Financial institutions in Brunei Darussalam are required to collect and report to the Collector of Income Tax Act as the Competent Authority the reportable financial account information starting from 1 January 2017. Financial institutions are required to collect information from 1st January to 31st December every year and report it (including nil returns if applicable) to the Competent Authority in the subsequent years no later than 30th June every year.
For more detail regarding the CRS please click OECD's website links as follows:
AEOI CRS Legislations in Brunei Darussalam
Legislation that governed the AEOI CRS in Brunei Darussalam enforced on 29th June 2017 are as follows:
CRS Registration and Deregistration of Financial Institution
All reportable Financial Institutions are required to register with Revenue Division, Ministry of Finance and Economy before 31 May every year to gain access to Brunei Darussalam AEOI Portal which will allow the reportable Financial Institutions to report reportable accounts to the Collector of Income Tax Act.
To determine whether your entity is a reportable Financial Institution under CRS AEOI, kindly complete the CRS Entity self-review classification toolkit here.
Registration of Reportable Financial Institutions can be made by emailing Revenue Division, Ministry of Finance and Economy at email@example.com by providing the following details:
- Name of the reporting financial institution;
- Whether the reporting financial institution is a custodial institution, depository institution, investment entity or specific insurance company, or is two or more of these;
- The full name, address, designation and contact information of an individual authorized by the reporting financial institution to be the point of contact of the institution for the purposes of the CRS;
- Authorization letter from the reportable Financial Institution; and
- IP Address of the reportable Financial Institution to be used to access the Brunei Darussalam AEOI Portal.
Once registration is successful, the authorized person will be able to report reportable accounts on behalf of the reportable Financial Institutions via Brunei Darussalam AEOI Portal. Submission of the reportable accounts via Brunei Darussalam AEOI Portal is to be done no later than 30 June every year.
Registration of reportable Financial Institution is valid until the end of the year annually. At 1st January every year, all registered reportable Financial Institutions will be deregistered, and an email will be send to the authorized person for re-registration process of reportable Financial Institutions for the new calendar year.
Any deregistration of reportable Financial Institution request can be made by emailing Revenue Division, Ministry of Finance and Economy at firstname.lastname@example.org attached with formal letter requesting for deregistration. Revenue Division, Ministry of Finance and Economy will then review the request and contact the Financial Institution for due-diligence process before confirming the deregistration.
CRS Collecting and Filing
Collecting CRS information
Brunei Darussalam adopt the "wider approach" which requires reporting financial institutions in Brunei Darussalam to collect and retain the CRS information for all account holders and where the account holder is a Passive Non-Financial Entity ("NFE"), the controlling persons of the Passive NFE. Reporting Financial Institution in Brunei Darussalam is required to apply the "look through" to identify the Controlling Persons and report (if any) each reportable controlling person. Reporting financial institutions in Brunei Darussalam are then required to only report financial account information relating to tax residents of Brunei Darussalam's relevant tax treaty partners to the Collector of Income Tax. Brunei Darussalam will then subsequently transmit the reported information to its relevant tax treaty partners.
Format of reporting
Reporting Financial Institutions can file their reportable account to Revenue Division, Ministry of Finance and Economy either by
- Manually entering the details in the Brunei Darussalam AEOI Portal; or
- Uploading XML files containing the reportable accounts to Brunei Darussalam AEOI Portal.
When preparing XML files to be uploaded to Brunei Darussalam AEOI Portal, the files will have to be in accordance to CRS XML Schema and XML Schema User Guide. The link to CRS XML Schema and XML Schema User Guide are as follows:
CRS XML Schema: https://www.oecd.org/ctp/exchange-of-tax-information/CRS-Schema-v2.0.zip
XML Schema User Guide: https://www.oecd.org/tax/exchange-of-tax-information/common-reporting-standard-xml-schema-user-guide-for-tax-administrations-june-2019.pdf
List of Participating Jurisdictions
In line with the approach outlined in paragraph 31 of the CRS Implementation Handbook, Brunei Darussalam considers all jurisdictions that have publicly and at government level committed to adopt the CRS to be Participating Jurisdictions. You may click here to refer to the above mentioned list.
Financial Institutions in Brunei Darussalam are required to collect and report to Ministry of Finance and Economy financial account information of all from Reportable Jurisdictions tax residents. As Brunei Darussalam adopt the wider approach, Financial Institutions are however advised to collect and prepare report for all participating jurisdictions instead of reportable jurisdictions to ensure that Financial Institutions are ready to submit reports within the timeline set (by 30 June every year) as the list of reportable jurisdictions will expand and updated from time to time.
The list of Reportable Jurisdictions for 2022 CRS Exchange are available here.
Revenue Division, Ministry of Finance and Economy expect all reporting FIs to fully comply with standard set by the CRS. In order to achieve this Revenue Division, MOFE have prepared compliance guide which consist consists of elements with hallmarks or desired outcomes in which FIs are expected to implement or have in place. Revenue Division, MOFE will be assured if FIs have implement or put in place all elements in complying with its CRS obligation. Furthermore Revenue Division will conduct compliance review from time to time based on the elements in the compliance guide with selected reporting FIs to ensure the level of compliance of reporting FIs is in accordance to the CRS standard. Please click here for the CRS compliance guide.
Voluntary Disclosure of Errors
While Revenue Division, Ministry of Finance and Economy believes that majority of reporting Financial Institutions in Brunei Darussalam are voluntarily compliant, FIs in Brunei Darussalam may occasionally make errors in their CRS returns due to negligence or lack of understanding of their CRS obligations. Revenue Division, MOFE encourages this Reporting FIs that have made errors in their CRS returns to come forward voluntarily as soon as they have uncovered the error to disclose these errors or omissions and get their CRS obligations right. The reporting FIs can contact Revenue Division through email at email@example.com for rectification process.
Information for account holders of financial institutions in Brunei Darussalam
AEOI CRS Guidance for account holders
Account holders may refer to FAQ and guide below for more info.
Tax Residency for self-certification
A self-certification form is a certification form filled by Account Holder which provide the Account Holder's status and other information requested by reporting financial institutions in Brunei Darussalam to fulfil its AEOI CRS reporting and due diligence obligations. This include determining whether the Account Holder is a resident for tax purposes in a Reportable Jurisdiction. The domestic laws of various jurisdiction have lay down conditions under which an individual or an entity is to be treated as tax resident. OECD has provided information on Tax Identification Number (TINs) and tax residency rules applicable in jurisdictions that are committed to automatically exchange information to help both account holders and financial institutions to comply their CRS obligation which are as follows:
Brunei Darussalam does not issue TIN for Individuals and Entities. However in the absence of TIN, functional equivalent for Individuals and Entities can be used to identify the account holders. You can visit details on Brunei TINs and its functional equivalent on the link below.
Brunei Darussalam's Tax Identification number and its functional equivalent: https://www.oecd.org/tax/automatic-exchange/crs-implementation-and-assistance/tax-identification-numbers/Brunei-darussalam-TIN%20.pdf
Any enquiries on CRS and AEOI
For any enquiries and questions regarding AEOI CRS, kindly email us at +6732383925 or email us at firstname.lastname@example.org.