Financial institutions are required to conduct globally standardized customer due diligence procedures designed to validate that self-certifications made by customers are actually true and technically accurate. This is why financial institutions need to put written policies and procedures in place and train their staff in techniques for determining the tax residence of their customers (both individuals and entities), as well as on the classification of entities under the terminology that the new paradigm brings with both FATCA and the Common Reporting Standard of the OECD.

We specialize in serving the needs of financial institutions in this context, meaning by financial institutions not only banks, but also credit unions, custodians, brokerage houses, investment advisors and investment managers, collective investment vehicles, trustees, trusts, ome insurance companies, fintech and players of the crypto ecosystem.

The effectiveness of cross-border operational-tax programs and automatic exchange of information for tax purposes depends, fundamentally, on due diligence, including the validation of self-certifications and withholding tax certifications that account holders provide to financial institutions.

Therefore, account holders, financial institutions and competent authorities need to understand the technicalities of due diligence, particularly those of self-certifications and withholding tax certificates (e.g. forms W-8 / W-9), so that proper withholding occurs when applicable and annual automatic reports are transmitted correctly.

In this regard, our work of designing detailed policies and procedures, assisting our clients in implementation, and providing training and recurrent consulting services for financial account due diligence, withholding and reporting has proven of the essence for our institutional clients to comply with their QI, FATCA and CRS obligations by minimizing risk and strengthening their reputation.