International Funds Transfer and Currency Conversion
International Funds Transfer and Currency Conversion in accordance with CRS regulation for automatic exchange of information
Israel, like many countries worldwide, signed the OECD common reporting standard (CRS) regulations, for the automatic exchange of information between countries – Systematic and periodic transmission of “bulk” taxpayer information by the source country to the residence country concerning various categories of income (e.g. dividends, interest, etc.) Information will be reported first to the tax authority in the country where the financial institute is located and then to the foreign country.
The Tax Authority receives excellent “intelligence” as result of international information exchange agreements, and now days every income tax inspector and squad coordinator have access to international financial transactions made by taxpayers (individuals and companies).
The CRS system may have other repercussions, as it is up to the banks to qualify clients as residents or non-residents, in particular new immigrants and returning residents who are not obliged to declare their income for 10 years. In this situation, the absence of declaration could be interpreted by the banks as a sign of non-residence status, which may contribute to forward inaccurate information to the tax authorities.
Planning a correct banking structure transfer activity will ensure that beyond reducing the tax burden, there will be a secure, convenient, and easy option for transferring funds – Our firm advise clients on required actions before transferring money abroad and the correct method of transferring funds considering the uniform standard in the world.
Assistance in auditing and regulating the source of funds transfer
Financial institutions tends to demand an explanation of the source of the funds that are requested to be transferred internationally, especially when it is a significant amount (among other things to make sure that tax has been paid for them and that it is not money laundering, etc.). Our office gives a confirmation letter to the bank regarding the source of the amount, and if necessary, advice the client’s accounting firm in matters of audit; clarifying and detailing the source of the funds.
Assistance in money transfer and currency conversion
Considering the banks’ strict conditions regarding transfer of funds abroad, and high fees for money conversions – our office handles the transfer of funds and assists in overcoming difficulties, such as high tax and conversion fees.
Withholding tax on transferring money abroad
Our office assists in preparation of the withholding tax forms for the tax authority, which is required by the financial institution and tax authorities before transferring the funds to the payer. In many cases there is a right to exemption from withholding tax. Accordingly, our office handles the completion of the green route for exemption or obtaining approval for the exemption from the tax officials.
Obtaining money transfer approvals from the assessors
Our firm handles obtaining the approvals for exemption from withholding tax for the purpose of transferring the funds to the payee abroad.
For more information and assistance contact us.
