FATCA/CRS
Banks and other financial institutions are required to identify all customers who are tax resident in a country other than Denmark. This applies to both private customers and legal persons. If you have been asked to complete our combined FATCA/CRS Self-Certification Form, you may have some questions about it. Therefore, we have created this FAQ page providing you with information about FATCA and CRS tax legislation, as well as about self-certification, the reporting process and the consequences of non-compliance.FATCA legislation and applicability
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What is FATCA?
FATCA is an acronym for Foreign Account Tax Compliance Act, which aims to counter tax evasion in the United States. All Nordic countries have signed an agreement with the US authorities concerning the exchange of information about customer who are in scope for reporting. Denmark has implemented obligations concerning the exchange of information in its national legislation. -
What does FATCA mean in practice?
All financial institutions in Denmark are required to comply with the requirements of FATCA. However, it should be noted that the approach may differ between them. Financial institutions have different approaches as to how they collect information from customers in order to verify their FATCA/CRS status. This is why the self-certification forms may differ between banks.
Danske Bank asks all its new customers and some of its current customers about their tax residency. If a customer is fully liable to pay tax outside Denmark, he/she is required to provide Danske Bank with a valid foreign Taxpayer Identification Number (TIN)Danske Bank.
Customers, who have been identified as liable to pay taxes in the United States, will be reported to SKAT in May each year. The same applies to customers where US indicia have been found, see below, and who do not respond to our enquiry.
The report to SKAT will contain information about account balances and income received on accounts which are in scope for reporting. -
Why have I received a letter and questions?
The bank is obligated to search for indicia, which indicate that a potential tax liability in the USA. This includes e.g. US citizenship, a US address or phone number.
The following information in the banks records results in us contacting you:
Customer information Curing documentation to avoid being reported US place of birth or US citizenship
Self-certification form, non US passport & certificate of loss of nationality
Green card
Self-certification form and non US passport
US mailing or residence address
Self-certification form and non US passport
US phone number
Self-certification form and non US passport
Standing order to transfer fund to a US account
Self-certification form and non US passport
Person with a US address has been granted power of attorney to manage the accounts
Self-certification form
Care of or hold mail address
Self-certification form
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I am a US tax resident. How does FATCA affect me?
FATCA means that Danske Bank will send information on your accounts to the tax authorities. You are responsible for making sure that you complete your tax return(s). -
My child is a US tax resident. How does FATCA affect it?
Minors are not exempt from reporting under FATCA. If your child is a US tax resident and a customer of Danske Bank, we would need the same information about your child as about you. -
I was born in the United States. How does FATCA affect me?
If you were born in the United States and you have not renounced your US citizenship, you are in scope for FATCA reporting. -
I have informed Danske Bank that I was a US tax resident. I am not anymore, what should I do?
If you previously have informed us that you were a US tax resident, but are not anymore, you need to send a self-certification form to Danske Bank with information about your current tax residency. Additional documentation may also be needed, see above.
CRS legislation and applicability
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What is CRS?
CRS - Common Reporting Standard - is a global standard for the automatic exchange of financial account information.
The objective of CRS is to counter international tax evasion. The CRS standard requires financial institutions to identify financial accounts held by customers who are tax resident in a state or jurisdiction other than their own. The CRS regulation is based on the FATCA regulations, but there are key differences between CRS and FATCA. The main difference is that CRS encompasses approximately 100 countries, as opposed to FATCA which only covers the United States and account holders who are tax resident in the United States.
All EU Member States have endorsed CRS and signed an agreement on automatic exchange of financial information (the DAC2 directive). -
What does CRS mean in practice?
All financial institutions in Denmark are obliged to comply with the requirements of CRS. However, it should be noted that the approach may differ between them. Financial institutions have different approaches as to how they collect information from customers in order to verify their CRS status. This is why the self-certification forms may differ between banks.
Danske Bank asks all its new customers and some of its current customers about their tax residency. If a customer is generally liable to pay tax outside Denmark, it is required to provide Danske Bank with a valid foreign Taxpayer Identification Number (TIN) Danske Bank.
Customers, who have been identified as liable to pay taxes in a country other than Denmark, will be reported to SKAT in May each year. The same applies to customers where indicia of foreign tax liability have been found, see below, and who do not respond to our enquiry.
The report will contain information about account balances and income received on accounts which are in scope for reporting. -
I am a foreign tax resident. How does CRS affect me?
CRS means that Danske Bank will send information on your accounts to the tax authorities. You are responsible for making sure that you complete your tax return(s). -
My child is a foreign tax resident. How does CRS affect it?
Minors are not exempt from reporting under CRS. If your child is a foreign tax resident and a customer of Danske Bank, we would need the same information about your child as about you. -
I have informed Danske Bank that I was a US tax resident. I am not anymore, what should I do?
If you previously have informed Danske Bank that you were a foreign tax resident, but are not anymore, you need to send a self-certification form to Danske Bank with information about your current tax residency. Additional documentation may also be needed, see below.
Self-certification process
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Why have I received a letter and questions about foreign tax liability?
Danske Bank is obliged to search for indicia indicating a potential tax liability in a foreign country. This includes, e.g., a foreign address or phone number.
The following information in our system results that we ask question:Customer information Curing documentation to avoid being reported Foreign mailing or residence address
Self-certification form and passport other than that of the indicia country
The only phone number registered is non-Danish
Self-certification form and passport other than that of the indicia country
Standing order to transfer fund to a foreign account
Self-certification form and passport other than that of the indicia country
Person with a foreign address has been granted power of attorney to manage the accounts
Self-certification form
Care of or hold mail address
Self-certification form
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How do I know if I am tax resident in another country?
In general, you are considered tax resident in the country where you spend more than 183 days in any 12-month period. However, in some countries you are considered tax resident even if you live in another country, for example if your family or permanent residence is in that other country.
A few countries, like the United States, base taxation on citizenship. If you are uncertain about where you are tax resident, please seek advice from the tax authorities or a tax specialist. -
What information do I have to send to you?
The information Danske Bank requests from you depends on the indicia found, please see above for details. If you are a new customer, you must always inform us where you are tax resident, including your Taxpayer Identification Number(s). -
What happens if I do not respond to the letter or submit incorrect information?
If you do not respond to a letter concerning foreign tax liability, Danske Bank will regard you as reportable to that country and send information to the tax authorities. If you intentionally submit incorrect information, Danske Bank may have to reconsider your engagement with us. -
What is TIN?
TIN is an acronym for Taxpayer Identification Number. If you are a US tax resident and lack a US TIN, you must contact the Internal Revenue Service. -
Where can I find information about the local equivalent of a TIN in my country?
For details about the Taxpayer Identification Number in your country, please consult your professional tax advisor or visit the section on Tax Identification Numbers on the OECD CRS portal. -
What do you mean by tax residency and tax liability?
Danske Bank is obliged to have information on where you are tax resident, meaning in which country or countries you are regarded as fiscally domiciled (full tax liability) according to that country’s national legislation. -
Other banks have requested the same information
If you are a customer of another bank and have informed it about your tax residency, you also have to inform us. Banks do not exchange information about customers with each other.
FATCA and CRS reporting
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Do you send any information to the tax authorities?
Danske Bank submits information about reportable customers, their accounts and income such as dividends, interest and sales proceeds credited to their accounts once a year. -
Why do you have to register where I am liable to pay tax?
As a result of FATCA and CRS, banks and financial institutions operating in Denmark – including Danske Bank – must identify customers liable to pay tax outside Denmark. In addition, banks and financial institutions must report information about such customers to the Danish tax authorities (SKAT), which will disclose the information to the relevant foreign tax authorities.
