On 18 August, I attended the latest Charities CRS Working Group meeting, hosted by HMRC. The main issues discussed were as follows:
- HMRC confirmed that CIOs (charitable incorporated organisations) will be treated in the same way under CRS as other corporate bodies and this will be incorporated into the new guidance.
- HMRC confirmed that collection of Taxpayer Identification Number (TIN) and date of birth information is on a best-efforts basis if the charity does not already hold the information. A charity should also make best efforts to get a self-certification prior to issuing a grant, however they are not compelled to refuse to give a grant without a self-certification.
- Charities have an obligation to tell their beneficiaries that their data may be shared, as per Regulation 6. There is no requirement under Data Protection to seek consent from the beneficiaries, since the data is being shared under a legal requirement.
- HMRC are still reviewing the anti-avoidance measures and they will provide an update when compliance colleagues have been consulted further.
- HMRC will add further examples to the guidance regarding the definition of ‘indirect beneficiaries’ to help illustrate cases around identifying who is the beneficiary of a grant.
Potential human rights abuses are still a major concern among the charity sector. HMRC are taking into consideration some instances where the exchange of data may not be warranted and could be tantamount to a breach of human rights. HMRC have been collecting examples from the working group in order to increase transparency around this issue and to take on board potential activities of jurisdictions where there are existing concerns around human rights.
The new guidance manual has been published on HMRC’s website and can be viewed via this link:
HMRC also published this Guidance Note for charities in relation to automatic exchange of information.
HMRC intend to host some CRS charity-specific seminars around the country and STEP will flag these events as they arise.
On a broader CRS basis, the HMRC AEOI team is running an educational event aimed at businesses and agents in the small and medium sectors who are affected by AEOI and would like more information. The event will include speakers from agents, industry and HMRC as well as the opportunity for 1‐2‐1 ‘surgeries’ plus small group discussions on due diligence best practice. The event will take place on 7 October 2016 in London. To register an interest in the event please email email@example.com
STEP will continue to attend the periodic working group to discuss ongoing technical issues with HMRC in this connection.
Emily Deane TEP, STEP Technical Counsel