Information that We Report About Clients-Common Reporting Standards

Common reporting standards

What we report about you

In March 2016 the global version of the United States' Foreign Account Tax Compliance Act (FATCA), known as the Common Reporting Standard (CRS), came into effect in Lesotho. Both FATCA and CRS affect individuals, entities and financial institutions globally.

CRS is the global standard for the automatic exchange of financial account information and extends to all accounts held by foreigners or non-residents and not only those of US citizens, which is what FATCA covers.

These regulations aim to combat tax evasion and require financial institutions (such as Nedbank) to collect and report certain information about financial accounts required under FATCA and CRS on financial accounts to the Lesotho Revenue Authority (LRA).

Financial institutions must collect information and report to the LRA about clients (both individuals and entities):

• that are US citizens or tax residents;
• that have tax obligations outside the Kingdom
  of Lesotho; or
• that have US or other foreign details
  recorded on our systems. 

These details include the following:

• Citizenship
• Physical/Residential address
• Place of birth
• Postal address
• Controlling persons and relationship to the company
• Power of attorney
• Telephone numbers
• Care-of address 

The following information will also be reported to the LRA:

• Financial accounts, for example bank accounts or stockbroking accounts.
• Balances and payments into or out of these accounts.
• Type of income received.
• Nature or classification of the company.
• Tax residencies and tax identification numbers. 

LRA will then share the information with other relevant global tax authorities,
which in turn share information with the LRA on Lesotho tax residents who
hold financial accounts outside Lesotho. This could result in additional
investigations by the LRA. 

If you do not have another citizenship or nationality resulting in tax obligations
outside Lesotho, FATCA and CRS will have a minimal impact on you, except
that you must provide additional information to financial institutions such as Nedbank.

It is imperative that clients are fully aware of their tax obligations to ensure
compliance with these obligations. 

It is therefore important to contact your tax advisor if you have any questions or if you are uncertain about your tax obligations. 

Nedbank may contact you in due course to obtain or update the tax-related information we have on record for you.

Penalties and interest can be imposed by the LRA on both the financial institution
for not reporting all the affected clients to LRA, as well as and on the individual for not providing all the requested information to the financial institution.