CRS Expansion: New Jurisdictions Joining the Automatic Exchange Framework

The CRS Framework — Where We Stand

The Common Reporting Standard (CRS), developed by the OECD and endorsed by the G20, is the most comprehensive multilateral tax transparency framework ever implemented. Since its first exchanges in September 2017, CRS has grown from 49 early-adopter jurisdictions to over 120 committed jurisdictions exchanging financial account information automatically on an annual basis.

The practical effect is that a tax resident of any participating jurisdiction who holds a financial account in another participating jurisdiction will have that account reported to their home tax authority — automatically, without any specific request or investigation.

How CRS Works — A Technical Summary

The Reporting Chain

1. Financial institution (bank, broker, custodian, certain insurance companies, investment funds) identifies account holders who are tax residents of other CRS-participating jurisdictions
2. Due diligence procedures: The institution applies due diligence procedures to classify accounts as "reportable" based on the account holder's tax residence (determined by self-certification and residence address tests)
3. Reporting to local authority: The institution reports the account information (account balance, income, gross proceeds) to its local tax authority annually
4. Automatic exchange: The local tax authority transmits the information to the account holder's jurisdiction of tax residence under the Multilateral Competent Authority Agreement (MCAA) or bilateral agreements

What Is Reported

For each reportable account, the following information is exchanged:

• Name, address, jurisdiction of residence, and TIN (tax identification number) of the account holder
• Account number
• Name and identifying number of the reporting financial institution
• Account balance or value at the end of the calendar year (or at the time of closure)
• Interest, dividends, and other income credited to the account during the year
• Gross proceeds from the sale or redemption of financial assets

Entities and Trusts

CRS applies not only to individual account holders but also to:

• Passive non-financial entities (passive NFEs): If an entity is classified as a passive NFE, the financial institution must "look through" the entity and report the controlling persons — typically the beneficial owners
• Trusts: Where a trust holds a financial account, the reportable persons include the settlor, trustee, protector, beneficiaries, and any other natural person exercising ultimate effective control over the trust
• Foundations: Similar look-through rules apply to foundations and similar arrangements

The 2025 Expansion

Newly Committed Jurisdictions

Several jurisdictions made first-time CRS exchanges in 2025 or committed to exchanges beginning in 2025-2026:

• Thailand: Committed to CRS implementation with first exchanges in 2025 under the Revenue Code amendments of 2023
• Turkey: First exchanges commenced in 2020, with expanded bilateral exchange relationships activated in 2025
• Kenya: Committed to CRS exchanges as part of its Global Forum membership commitments
• Rwanda: Committed to exchanges under the MCAA
• Paraguay: Committed to CRS implementation with technical assistance from the OECD
• Philippines: Implementing the automatic exchange framework with first exchanges scheduled

Expanded Bilateral Networks

Existing CRS jurisdictions expanded their bilateral exchange relationships in 2025. The activation of new bilateral relationships means that accounts held in Jurisdiction A by residents of Jurisdiction B will be reported for the first time — even though both jurisdictions may have been CRS-participating for years.

This is particularly significant for:

• Middle Eastern jurisdictions: The UAE, Saudi Arabia, and Qatar expanded their bilateral exchange networks to include additional African and Asian jurisdictions
• Caribbean jurisdictions: Cayman Islands, BVI, and Bermuda activated additional exchange relationships with Latin American jurisdictions
• Asian financial centres: Singapore and Hong Kong expanded exchanges with Central and South American jurisdictions

The Crypto-Asset Reporting Framework (CARF)

The OECD finalised the Crypto-Asset Reporting Framework in 2023, designed to extend CRS-style automatic exchange to crypto-assets. Key features:

Scope

CARF applies to:

• Crypto-Asset Service Providers (CASPs): Exchanges, wallet providers, broker-dealers, and any entity that facilitates the exchange or transfer of crypto-assets
• Reportable crypto-assets: Any digital representation of value that relies on cryptographically secured distributed ledger technology — including Bitcoin, Ethereum, stablecoins, and certain NFTs

Reporting Obligations

CASPs must report:

• Name, address, jurisdiction of residence, and TIN of each user
• Each type of crypto-asset and the aggregate value of transactions (exchanges for fiat, exchanges for other crypto, transfers)
• The number of units transferred and the fair market value

Implementation Timeline

Early-adopter jurisdictions (including the EU member states, UK, Canada, Australia, and Singapore) committed to implementing CARF by 2026-2027. The EU's DAC8 directive (Directive 2023/2226) incorporates CARF into EU law, requiring implementation by member states by 31 December 2025.

Practical Impact on Offshore Account Holders

No More "Non-Reporting" Havens

With 120+ jurisdictions now participating in CRS, there are effectively no major financial centres that do not report financial account information. Jurisdictions that were historically non-participants — such as certain Pacific island nations — lack the financial infrastructure that clients require.

The practical consequence is that holding assets offshore does not provide tax opacity. Home tax authorities will receive information about offshore accounts regardless of the jurisdiction.

The Compliance Imperative

For account holders, CRS creates a compliance imperative:

• Self-certification: Account holders must provide self-certification forms (typically CRS-1 or equivalent) to their financial institutions, declaring their jurisdiction of tax residence
• Accuracy: Providing false self-certification information is a criminal offence in most jurisdictions
• Multiple residences: Account holders who are tax resident in multiple jurisdictions may have their accounts reported to all relevant jurisdictions
• Changes in residence: Account holders who change their tax residence must update their self-certification within the timeframe specified by the financial institution (typically 30 to 90 days)

Trust Structures Under CRS

CRS reporting of trusts is particularly comprehensive:

• The trustee is reported as the account holder
• The settlor, protector, and beneficiaries are reported as controlling persons
• Discretionary beneficiaries are reported even if they have not received distributions
• Trust protectors and investment advisors with control over the trust are reported

This means that the existence of an offshore trust — and the identities of all persons connected to it — will be reported to the relevant tax authorities. The trust provides asset protection and succession planning benefits, but it does not provide information opacity.

Voluntary Disclosure Programmes

Many jurisdictions have operated voluntary disclosure programmes offering reduced penalties for taxpayers who come forward with previously unreported offshore accounts before CRS data is received. These programmes have been largely successful:

• UK: The Worldwide Disclosure Facility and the Requirement to Correct provisions produced significant voluntary disclosures
• Australia: The Australian Taxation Office's voluntary disclosure programme offered reduced penalties for early disclosure
• United States: The IRS Streamlined Filing Compliance Procedures remain available for taxpayers who can certify that their non-compliance was non-wilful

As CRS data continues to flow, the opportunity for voluntary disclosure narrows. Tax authorities are increasingly using CRS data to identify non-compliance and initiate enforcement actions.

Key Takeaways

• CRS now covers 120+ jurisdictions, effectively eliminating information asymmetry between offshore account holders and their home tax authorities
• The 2025 expansion brought additional jurisdictions into the framework and activated new bilateral exchange relationships
• CARF will extend CRS-style reporting to crypto-assets from 2026-2027, closing the last major gap in the automatic exchange framework
• Trust structures are reported comprehensively under CRS, including the identities of settlors, protectors, and discretionary beneficiaries
• Offshore structures continue to serve legitimate purposes (asset protection, succession planning, investment diversification) but do not provide tax opacity
• Account holders must ensure accurate self-certification and compliance with home-country reporting obligations
• Voluntary disclosure programmes remain available in many jurisdictions but the window is narrowing as enforcement based on CRS data accelerates