Tax residency outside Denmark?

The rules are called Common Reporting Standard or CRS. This is a global standard for automatic exchange of information on financial accounts. This standard requires banks to identify accounts held by customers whose tax residency is outside Denmark or in another jurisdiction. The purpose of CRS is to prevent international tax evasion. The CRS rules became effective on 1 January 2016.

All financial institutions are required to

• establish the tax residency of new personal and corporate customers
• review their databases of existing personal and corporate customers to identify customers with tax residency outside Denmark  
• identify certain corporate customers/legal persons and their beneficial owners/controlling persons with tax residency outside Denmark
• report customers with tax residency outside Denmark to SKAT.

The expression tax residency means that a person is subject to tax in a country (tax residency) in accordance with the relevant country's legislation.

Undertakings/legal persons

Generally, a legal person is a tax resident of a country if that legal person under the relevant country's legislation pays or ought to pay tax there according to its residency, business address, registered office or other similar criteria.  
Subsidiaries/branches of legal persons:
Normally, the tax residency of a branch of a legal person is only the country in which the branch’s legal person is subject to tax. Example: Swedish subsidiaries/branches of Danish undertakings are normally only residents for tax purposes in Denmark.
When is a legal person subject to tax in another country?
The other country's legislation determines the criteria for when a legal person is considered a tax resident of that country. Legislation covers different forms of connection to the country forming the basis for overall taxation (full tax liability) according to that country's tax law.
Individuals
Generally, the tax residency is the country where the individual resides. Under special circumstances (studies or job abroad or long-term travelling etc) individuals may reside in another country or in more than one country at the same time.
When is an individual subject to tax in another country?
Generally, the tax residency is where the individual has his or her permanet residence or home. However, each country has its own rules that define residency for tax purposes.

Read more about the rules on tax residency in different jurisidictions on OECD Automatic Exchange Portal Opens in new window.
If you have any questions about your tax residency, please consult a tax adviser or contact the local tax authorities. 

You must answer the questions we ask. If you are a tax resident of one or more countries, we may ask you to fill in a self-certification form. In that form you must state your tax residency and taxpayer identification number (TIN number).

A taxpayer identification number (TIN number) is a unique combination of letters and figures that an individual or a legal person receives from the authorities for tax purposes.
In some cases you must apply for a TIN number. Read more here (Link to http://www.oecd.org/tax/automatic-exchange/crs-implementation-and-assistance/tax-identification-numbers/#d.en.347759)  

From 2017 we will each year report the following information applicable to 2016 and onwards:

• the balance/value of custody, trustee, insurance and securities accounts
• interest, dividends and other returns
• gross proceeds and gross amounts (from the sale of securities and shares and/or funds etc) and the proceeds from redemption.
  

As far as passive non-financial units are concerned, we also report beneficial owners/controlling persons who are subject to tax in another country.

There is no duty to report

• pension-related insurance and pension savings accounts fulfilling certain criteria (”Selvpensionskonti”, private pension accounts)
• estate accounts 
• escrow accounts
• accounts held by listed companies or their group entities
• home, education and children's savings accounts.

We will contact the customers affected and tell them what information we need and what forms to be filled in to meet the CRS rules. 

Yes. When contacting you, we will either attach the relevant forms or add a link to a website where you can download the forms.

If you do not provide the information required by CRS, we are required to report the information we have. This could mean that you will be reported as having tax residency in another country.  

Are only foreign undertakings affected?
No. CRS does not only apply to foreign undertakings. We will contact many customers to establish their CRS status and classify them correctly. For this purpose we submit Nordea forms to be filled in.

I am a non-Danish individual and hold a large stake in an undertaking – in what way will I be affected?
Holding a large stake in an undertaking, you are likely to be the beneficial owner of/controlling person of the undertaking. We may be required to report information about you, but it depends on the activities of your business. If your undertaking is passive, we must report information about you if you are the beneficial owner or controlling person of the undertaking. An undertaking is considered passive if, for instance, 50% of the undertaking's income or more consists of interest and dividends.

A beneficial owner/controlling person means the individual exercising control over an undertaking. In this context control means direct or indirect ownership of more than 25% of the undertaking's financial assets.

Du kan bruge den vedlagte svarkuvert eller sende dokumentationen til : FATCA/CRS DK, Postboks 850, 0900 København C.