Interaction procedure of financial agents for fulfillment of the CRS requirements for joint investment institutions entered into force

Press service of the State Tax Service of Ukraine, published 28 December 2023 at 11:11 Chapter: News

Order of the Ministry of Finance of Ukraine № 674 as of 07.12.2023 "On approval of Interaction procedure of financial agents for fulfillment of requirements of Article 39³ Section I of the Tax Code of Ukraine regarding joint investment institutions" entered into force on 25.12.2023 (hereinafter – Interaction procedure of financial agents). 

This Procedure applies to depository institutions that open (maintain) accounts in securities of depositors – investors of joint investment institutes and asset management companies.

Requirements of the Tax Code of Ukraine (Sub-paragraph 39³.11.3 Paragraph 39³.11 Article 39³) stipulate that each depository institution that opens (maintains) account in securities of depositor – investor of joint investment institution, performs obligations of conducting proper comprehensive audit of this account and establishes account’s accountability. Depository institution is obliged not later than 30 calendar days after end of each calendar half-year to provide the asset management company with notifications about depositors who have purchased securities of mutual investment institutes whose assets are managed by such asset management company (hereinafter – Notification) and to notify about changes in circumstances affecting determination of tax status of such depositors or their controlling individuals.

Interaction procedure of financial agents establishes:

- general provisions regarding requirements for the form and format of Notification and interaction procedure of accountable financial institutions for fulfilling the CRS requirements (Common Reporting Standard);

- terms and procedure for sending Notification and information to be provided in such Notification;

- submission specifics of Notification for the second half of 2023, as well as for the first and second half of 2024 (list of asset management companies to which Notification is sent; information to be reported for each of these periods);  

- submission procedure of requests to depository institution by the asset management company, etc.

Paragraph 5 of the Interaction procedure of financial agents stipulates that  Notification is created using the XML schema "CRS XML Schema (v2.0)", which was developed by the Organization for Economic Cooperation and Development (XML schema and the User's Guide are posted on web portal of the State Tax Service). 

State Tax Service draws attention of all financial institutions of Ukraine, which as of 30.06.2023 met criteria of accountable financial institutions, about obligation to register in the State Tax Service by 31.12.2023. More details in clarification of the Ministry of Finance on certain matters of compliance by accountable financial institutions with requirements of the Common Reporting Standard at the link.

Common Reporting Standard and commentary to it in Ukrainian and English, Interaction procedure of financial agents, as well as other explanations are posted on web portal of the State Tax Service and official website of the Ministry of Finance.     

Implementation of international standard of automatic exchange of information on financial accounts into Ukrainian legislation and practice is carried out with support of the European Union Programme for Support of Public Finance Management in Ukraine (EU4PFM).