CRS and multiple citizenships

[qers]

Hi, I've been reading about CRS on this forum and still have doubts about my situation.

1. I'm Spanish but living in Portugal (NHR). I also happen to hold a second passport (Ireland). I'm considering opening a broker to buy stocks and was wondering if it makes sense to use my second passport (Ireland). So let's say I open a broker account with DeGiro or IBKR and provide my Irish passport and Portuguese TIN. Would Spain ever get any CRS info from that broker? I'm asking as it seems citizenship might also trigger reporting in some cases.

2. What would be the consequences of hiding one of my citizenships if the broker finds out?

3. If I ever move out of Portugal and de-register myself as a taxpayer, what would happen if I do not update the broker with my new tax residency address? I guess the broker will continue to report to Portugal as usual, but what would Portugal do then?

 

[Martin Everson]

qers said:
1. I'm Spanish but living in Portugal (NHR). I also happen to hold a second passport (Ireland). I'm considering opening a broker to buy stocks and was wondering if it makes sense to use my second passport (Ireland). So let's say I open a broker account with DeGiro or IBKR and provide my Irish passport and Portuguese TIN. Would Spain ever get any CRS info from that broker? I'm asking as it seems citizenship might also trigger reporting in some cases.
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CRS is about tax residency not nationality. If TIN and your residency address are in Portugal then that is where they would report.

qers said:
2. What would be the consequences of hiding one of my citizenships if the broker finds out?
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Makes no difference your citizenship unless your an American in which case FATCA kicks in. You could in a rare case be in violation of their T&C if they require you to declare all nationalities and they later find out you did not.

qers said:
3. If I ever move out of Portugal and de-register myself as a taxpayer, what would happen if I do not update the broker with my new tax residency address? I guess the broker will continue to report to Portugal as usual, but what would Portugal do then?
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Yes they would continue to report to Portugal. It's down to Portugal taxman to investigate and decide what to do next.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[zzzzzz]

qers said:
3. If I ever move out of Portugal and de-register myself as a taxpayer, what would happen if I do not update the broker with my new tax residency address? I guess the broker will continue to report to Portugal as usual, but what would Portugal do then?
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I was reading annual report of my taxman (EU) for one of the past years. They mentioned they also get CRS data for people who deregistered in the past, but "forgot" to tell foreign FI about their new tax residency. In that case, they start investigation - are you really tax nonresident or not, as you are still using benefits of your old tax residency and still have ties to your old country.

 

[pesto]

Martin Everson said:
CRS is about tax residency not nationality. If TIN and your residency address are in Portugal then that is where they would report.
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I would have posted the same.

 

[qers]

Thanks for the answers! Much appreciated

 

[KScyprus]

Martin Everson said:
CRS is about tax residency not nationality. If TIN and your residency address are in Portugal then that is where they would report.



Makes no difference your citizenship unless your an American in which case FATCA kicks in. You could in a rare case be in violation of their T&C if they require you to declare all nationalities and they later find out you did not.



Yes they would continue to report to Portugal. It's down to Portugal taxman to investigate and decide what to do next.
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What happens (between European countries) if person A lives in country A but is a citizen of country B and:

1) You declare to a financial institution that you are still resident in Country B (but actually live in Country A);
2) You declare to a financial institution that you are in Country B (and in fact live in Country B).

In the first case, would country A go to country B to share the information received from the financial institution?
In the second case, will Country B also communicate something to Country A?

 

[Martin Everson]

KScyprus said:
In the first case, would country A go to country B to share the information received from the financial institution?
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Ok hope I understood you correctly conf/(%. Country A is not on record with bank so has no involvement in this situation and will not receive any data unless CRS indicia related to country A is detected. Banks like N26 have made clear they will use indicia to determine where to report data.

KScyprus said:
In the second case, will Country B also communicate something to Country A?
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No. Country B is likely to do what happened to me when I failed to update the address on a bank account to where I was currently living. The taxman of country B cheekily just sent me a request to file a tax return - easy way for them to see whats what. This request took a while to reach me as I no longer lived in that country and lived abroad. By that time I got it I had late filing penalties to pay and still had to file a tax return as a non-resident 😕.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[KScyprus]

Martin Everson said:
Ok hope I understood you correctly conf/(%. Country A is not on record with bank so has no involvement in this situation and will not receive any data unless CRS indicia related to country A is detected. Banks like N26 have made clear they will use indicia to determine where to report data.




No. Country B is likely to do what happened to me when I failed to update the address on a bank account to where I was currently living. The taxman of country B cheekily just sent me a request to file a tax return - easy way for them to see whats what. This request took a while to reach me as I no longer lived in that country and lived abroad. By that time I got it I had late filing penalties to pay and still had to file a tax return as a non-resident 😕.
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Wao! Bad story. But I think if you lived elsewhere, it would have been easy for you to reply to your country that it was a formal mistake and that you didn't have to pay taxes to your old country.