10 February 2023
SARS updated the Clarification document for AEOI (FATCA) Reporting TIN Codes. The purpose of this document is to clarify the application of the supplied codes for the Taxpayer Identification Number (TIN) data fields for FATCA submissions. This version 3 was updated to align with the IRS Notice 2023-11.
You can read the updated AEOI document here.
Visit the Automatic Exchange of Information webpage of SARS here.
What is the Automatic Exchange of Information (AEOI) standard?
The Automatic Exchange of Information (AEOI) is a global standard for the automatic exchange of financial account information between tax authorities in different countries. The purpose of the AEOI is to combat tax evasion and promote tax compliance.
It is an important tool for promoting transparency and combating tax evasion on a global scale. By requiring financial institutions to collect and report information on their customers’ financial accounts, the AEOI helps to ensure that taxpayers are meeting their tax obligations and that governments can collect the revenue they need to fund public services.
Additional reporting requirements
Under the AEOI, financial institutions, including banks and other financial intermediaries, are required to collect and report information on their customers’ financial accounts to their local tax authority. This information includes details on account balances, interest income, dividends, and other income and proceeds.
The tax authority then exchanges this information with the tax authorities of other countries with which it has signed an agreement to participate in the AEOI. This allows tax authorities to identify cases where taxpayers are not reporting all their income, and to take appropriate action to ensure compliance with tax laws.
International exchange of financial information
The AEOI was developed by the Organisation for Economic Co-operation and Development (OECD) and has been adopted by over 100 countries, including South Africa. South Africa signed the Multilateral Competent Authority Agreement (MCAA) for the automatic exchange of financial account information in 2014 and began exchanging information under the AEOI in 2017.
1 thought on “<strong>Updated guide on Automatic Exchange of Information (AEOI)</strong>”
Brilliant updates, thank you !