Recently, the Chinese entertainment industry can be described as a storm. Tax is the foundation of a country. How can we do it without looking at it?.
But Chinese compatriots and Chinese friends in Australia, you know? Right now, a national trial is coming!
The time is in September this year!
All Chinese passport holders in Australia, Australian passport holders, everyone is ready!
This time, it`s real!
In order to strengthen international tax cooperation and combat cross-border tax evasion, the International Organisation for Economic Co-operation and Cooperation for Economic Cooperation and Development (OECD) published the automatic exchange of tax-related information on financial accounts (Common Reporting Standard).) in July 2014.
Driven by the G20, 101 countries have acceded to the agreement, including those that have not yet been implemented, and pledged to exchange tax information publicly.
Among them, countries that have not been implemented, including
- Chinese (China)
- Australian (Australia)
By 2017, 55 countries had implemented Common Reporting Standard (CRS), now halfway through 2018, and 46 countries are joining the official executive team.
And China, and Australia is starting from this year, the time is scheduled for September this year!
From Chinese tuhao, to Chinese students, to Chinese migrant workers in Australia, and even to some Australian Chinese PRP!
Once checked, your accounts will be instantly "transparent"!
Not only that, but you might suddenly have to face the following serious question: is double taxation coming?
At that time, what was included in the announcement issued by the six ministries?
What is the impact on Chinese residents and overseas Chinese?
On May 9, 2017, the State Administration of Taxation, the Ministry of Finance, the people`s Bank of China, the Banking Regulatory Commission, the Securities Regulatory Commission and the Insurance Regulatory Commission jointly announced that they would soon begin an inventory of "non-resident" financial account information.
The official implementation date is July 1, 2017.
Based on the site of the implementing countries last year, as well as the published government information, the detailed implementation details are as follows
The tax authorities of various countries exchange financial information between individual tax residents and enterprises.
Exchange process of tax-related information
Under the Standard, information on the financial accounts of non-tax residents in financial institutions will be collected and reported to tax authorities between countries.
Among them, financial institutions include:
The financial accounts to be exchanged include:
See here, you may see clearly, this measure, for the fight against Tuhao overseas money laundering dark operation, can be said to be very pleasant!
Of course, it also means that as long as you are a "tax resident" of China, and one of the CRS standards participating countries overseas has a large number of financial assets, and is not a tax resident of the country, then your overseas financial assets will be nowhere to hide!
Your assets are transparent in front of China`s General Administration of Taxation!
Seeing this, some Chinese friends who have emigrated to Australia may be "relieved": "I have already got the Australian PR, and look at what is said above, I am not a Chinese tax resident anymore, should I not be checked?"
However, don`t forget, even if you are not a tax resident in China, you may be a tax resident in Australia.
So, what is "tax resident"?
The concepts of "resident" and "tax resident" are not the same-
According to the tax Law of the people`s Republic of China, the individual tax resident of China is a person who has a domicile within the territory of China or has lived within the territory for a period of one year without domicile (domicile in China refers to a family due to domicile). Economic interests and habitual residence in China);
Chinese tax resident enterprises refer to enterprises (including other organizations) established in accordance with the law in China or established in accordance with the laws of foreign countries (regions), but whose actual administrative institutions are within the territory of China.
For Chinese tax residents: financial institutions do not collect and submit information about their accounts, nor do they exchange them with other countries.
However, because of the different standards of "tax residents" in other countries, individuals may constitute two conditions for Chinese tax residents and residents of other countries and regions at the same time.
In this case, the account information in China will be exchanged with the tax authorities in the corresponding country, and the account information in the country will also be exchanged with the State Administration of Taxation.
Implementation in Australia
Based on information already available on the Australian Inland Revenue Service`s (ATO) website, it was determined that they would begin to collect information in July 2017.
The first exchange of information will begin in 2018.
The implementation rules of Australia`s CRS state that the person who needs to be reported should be the statutory taxpayer of another country.
In other words, if a person is not an Australian tax resident, that person`s information will be exchanged with his taxable country.
So how does Australia`s tax residents define it?
On the IRS website in Australia, the definition of overseas persons in Australia as "tax residents" in Australia is as follows:
In conclusion:
- A permanent residence (PR), or a temporary visa, for more than six months of continuous stable life in Australia (study or work), even if the middle is short of time, is still a tax resident of Australia;
- But on top of that, tourists, vacationers and six-month vacationers with frequent job shifts, such as migrant vacationers, are tax residents of foreign countries.
So, including international students, permanent immigrants and Chinese Australians, they are basically tax residents of Australia, so they are not on the information exchange list.
But! But! But!
If, at the same time, you lose the identity of Chinese tax residents, the State Administration of Taxation will also report your financial assets in China to the Australian tax authorities.
What`s the impact if your information "misfortunes" is collected and reported?
First, the financial information exchange is not something to worry about for those who are reasonably and legally working, living and investing in Australia.
Because this exchange of information is not a policy for disclosing privacy and the amount of assets.
The purpose of collecting this information is to more effectively regulate the overseas assets taxes of this group of people involved and prevent international tax evasion.
It is worth noting, however, that some grey assets may indeed be exposed.
For example,
Some Chinese students` parents (Chinese tax residents) are not themselves Australian tax residents, but may have opened accounts and deposits in Australia, and their sources of assets and funds may be subject to investigation.
Or,
In order to evade taxes, some Australian Chinese PR (Australian tax residents) put some of their assets in the names of Chinese relatives of non-tax residents to achieve the purpose of underpaying taxes.
There are also some who come to Australia as Chinese tourists (Chinese tax residents) to open accounts.
Transfer of assets to Australian financial institutions.
At that point, the holders of these wealth may need to explain three things to China`s government about the wealth involved:
- Tax interpretation
- Source explanation
- Foreign exchange control interpretation
At that time, the specific implementation process and time nodes are:
- On July 1, 2017, the identity of tax residents was formally investigated.
- Prior to December 31, 2017, the completion of high net worth account due diligence.
- In September 2018, the first exchange of information was completed.
- Due diligence on accounts will be banned until December 31, 2018.
All in all, as soon as the time is up, once checked, the right thing to do is four words!
Yes! Close! Tune! Charlie!
And the real existence of overseas tax evasion, tax avoidance and hidden assets, waiting for you, there are only the following four words!
June is nearing the end. As the angry tide of the "Yin-Yang contract," rifled by little Cui Nuo in the entertainment industry, scattered all over the world, Chinese and Australian passports with Chinese passports and Australian passports, the people of all over the country are subject to examination. It`s really coming!
Before paying taxes in accordance with the law and abiding by the law, especially before dealing with the transfer of transnational funds, we must clarify the tax system for financial transactions of the two countries, pay the taxes in time, be overcharged, report them in time, and properly preserve the transaction records. Once checked, actively cooperate with the relevant departments in the investigation.
Also advised "part" Chinese and Australian Chinese tuhao, you played clever, sooner or later let you eat a big loss, rely on the happiness of counting money, this time really can not pass September.
