Regulation 7 Modification of due diligence requirementsI1

United Kingdom

(1)

This regulation modifies the due diligence requirements set out in regulation 6 in the case of a reporting financial institution but only if it makes an election applying those modifications.

(2)

If the institution obtains, or is in the process of obtaining, evidence of a person’s relevant tax status in relation to any preexisting account, it is entitled to rely on the evidence in relation to any account opened after 30 June 2014 unless it has reasonable cause to believe that the person’s relevant tax status has subsequently changed.

(3)

Paragraph (2) has effect in the case of preexisting individual accounts maintained by the institution for an account holder only if, for the purpose of establishing which of the cases in regulation 6(4) are applicable to those accounts, the institution treats all those accounts as a single preexisting individual account.

(4)

If the institution or a related entity obtains, or is in the process of obtaining, evidence of a person’s relevant tax status in relation to a financial account, the institution is entitled to rely on the evidence in relation to all financial accounts maintained by the institution for the account holder unless the institution has reasonable cause to believe that the person’s relevant tax status has subsequently changed.

(5)

The due diligence requirements set out in regulation 6 do not need to be met in relation to a financial account if—

(a)

the institution maintains the account as a result of a merger with, or acquisition of, a qualifying financial institution which had established the relevant tax status of the account holder and any controlling person, and

(b)

the institution has no reasonable cause to believe that the relevant tax status of the account holder or any controlling person has changed.

(6)

For this purpose “qualifying financial institution”, in relation to a financial institution, means another financial institution—

(a)

which has not previously been a related entity of the institution, and

(b)

which immediately before the merger or acquisition was either a reporting financial institution for the purposes of these Regulations or a financial institution described under sub-paragraph 1(p) of Article 1 of the relevant agreement.

(7)

An election under this regulation—

(a)

is to be made by being given to the Commissioners,

(b)

must be made in the return required under regulation 8, and

(c)

has effect in relation to the calendar year in respect of which the return is made and all later calendar years (unless subsequently withdrawn).

Annotations

Commencement

I1: Reg. 7 in force at 31.3.2014, see reg. 1(2)