Q&A about self-certification and tax liability abroad
If you have received a self-certification form regarding your tax residence from us, you may have some questions. Here are a number of questions and answers about the self-certification form, tax residence abroad and the underlying legislation.
We are obligated to report customers who we suspect to have a foreign tax residence to the Danish tax authorities. This is the reason for why we ask you to complete the self-certification form so we can ensure we report correct and valid information. You are likewise obligated to provide us with the information requested.
If you wish to read more about the rules, you can read more about the rules at the Danish tax authorities’ website (you can change language settings to English).
FATCA is a US regulation requiring financial institutions worldwide to report on accounts held by US taxpayers. The CRS, developed by the OECD, is a global standard for the automatic exchange of financial account information between participating countries. Both ensure transparency and compliance with tax regulations across borders.
TIN is an abbreviation of ‘Taxpayer Identification Number’ and is a foreign taxpayer identification number you use for submitting tax returns, for example, in the relevant country. The name of this type of number varies from one country to another. For example, in the UK, it is known as a National Insurance Number (NINO) and in the US, it is called a Social Security Number (SSN). If you are resident for tax purposes in the US but do not have an SSN, you must contact the US tax authorities, the Internal Revenue Service.
We are obliged under local regulations to identify and report financial accounts with links abroad, including the United States, to the Danish authorities. The Danish authorities then review the information with the tax authorities in the country of residence if you are resident for tax purposes there.
This reporting assumes that we have correct and valid information about you as a customer, so that the receiving authorities can link the information to a tax return in the specific country.
If you need to update your tax information, either because it has changed or for other reasons, you can always submit your information via the link below. danskebank.dk/taxinfo
If you are unable to submit the required information, please explain the reason when filling in the self-declaration. Once you have obtained the information, we ask you to send a new self-declaration with the information included.
We are contacting you for one of the following reasons:
We are collecting self-certification forms due to product-specific requirements and we need confirmation of your tax residency, or
We have indications that you are tax resident in a country other than the country in which you do your banking business. You are therefore asked to either deny or confirm this and provide us with additional information (such as your taxpayer identification number (TIN) or similar information).
The indications we have may be that
you were born in the US
you have a foreign home address or c/o address
you have changed you only contact number to a foreign telephone number
you have set up regular payments to another country than Denmark
you have issued a mandate (Power of Attorney) to a person who lives outside Denmark
What being ‘tax resident’ in a country means depends on the legislation applicable in the individual country. However, it generally means that you are liable to pay income tax on your total income in your country of residency – and potentially in other countries. This is also called ‘full tax liability’ as opposed to ‘limited tax liability’. As a general rule, you have full tax liability in a country if you live or stay there for more than 183 days out of a 12-month period. This principle also applies to children and minors, regardless of their income.
As a general rule, if you were born in the US, you have US citizenship. This means that, despite the above stipulations, you are domiciled in the US for tax purposes.
On the self-certification form, you must confirm only which country or countries you are resident in for tax purposes. Limited tax liability (for instance property tax abroad, tax on foreign rental income, withholding tax on foreign investments, etc.) does not result in having tax residency in the given country.
If you are uncertain about your tax residency, please consult your local tax authorities or a tax professional for clarification.
Under local tax reporting legislation, we are required to have information about your tax residency on a self-certification form. If we do not, we will be unable to offer certain products and services to you. The self-certification form also helps you ensure that the information we disclose to local tax authorities is correct.
If you do not fill in a self-certification form, we will be required to report to the tax authorities on the basis of the information we have. So it is important that the information you provide is correct and valid.
You can read more about the rules and your obligations on the website of the Danish Tax Agency: skat.dk
If you have confirmed – or we have information indicating – that you are tax resident in another country, we will report information about your accounts and holdings with us to the tax authorities together with identification details about you as account holder. This also applies to jointly held accounts. The local tax authorities who receive the information will in turn disclose it to the country in which you may be tax resident. The information includes
Name
Address
TIN
Tax residency (where relevant more than one country)
Account balances
Dividends, gross returns and interest on securities
Your taxpayer identification number (TIN) is the identifier you use when filing tax returns or communicating with the tax authorities. You can check the OECD's TIN website for advice on how to determine your TIN.
If we do not receive your tax information, or if the information we receive is incorrect and indicates that you are resident for tax purposes abroad, we are required to classify your accounts as reportable. In such case, the account information will be reported to the relevant local tax authorities.
We therefore recommend that you use the following link to send us a new self-certification form so that we can report your accounts/custody accounts correctly via danskebank.dk/taxinfo.
Your tax residency does not depend on whether you actually have an income and pay income tax. Equally, having an income from a given country does not always result in actual tax liability or tax residence in that jurisdiction. Irrespective of whether or not you have an income, you are considered to be tax resident and fully liable to pay tax in the country in which your permanent home is.
For example, if you have retired and moved abroad, you are still generally liable to pay tax on your pension payments in the jurisdiction its paid from, but you are generally not a tax resident of that jurisdiction. From a tax residency perspective, you are generally resident for tax purposes in the country to which you have moved.
The US has its own rules for determining whether you are resident for tax purposes there.
Private individuals are generally considered to be resident for tax purposes in the US if they reside in the country, have US citizenship (including those with dual citizenship), possess a valid work permit (a so-called Green Card), or have permanent residency in the US. If you meet one or more of these criteria, you may be tax resident in the US.
Private individuals born in the US are typically considered to be US citizens and are therefore subject to taxation in the US, unless they have formally renounced their US citizenship. Until such time, a person is expected to comply with their obligation to file their tax return in the US and to have a social security number (SSN).
US citizens living outside the US continue to be resident for tax purposes in the US. Consequently, financial institutions, including Danske Bank, are required to collect relevant tax information.
If you have renounced your US citizenship, Danske Bank is required to obtain documentation that confirms this.
More information can be obtained from the Danish Tax Agency or the US tax authorities (the IRS). There is a lot of information on their respective websites. You can also consult a tax professional. Danske Bank cannot advise you on the subject.
On weekdays between 9pm and 9am as well as on holidays between 4pm and 10am, we answer calls mainly concerning the blocking of cards and fraud suspicion. More contact numbers.
When you call us or we call you, conversations may be recorded and stored for documentation and security purposes. Read more about how we process personal data in, Danske Bank privacy notice.
On weekdays between 9pm and 9am as well as on holidays between 4pm and 10am, we answer calls mainly concerning the blocking of cards and fraud suspicion. More contact numbers.
When you call us or we call you, conversations may be recorded and stored for documentation and security purposes. Read more about how we process personal data in, Danske Bank privacy notice.
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