IEIM722010 - Definition

Reportable taxpayer is defined in Rule 1.4(l) of the Model Rules:

“Reportable taxpayer means in respect of a CRS Avoidance Arrangement, any actual or potential user of that Arrangement and, in respect of an Opaque Offshore Structure, a natural person whose identity as a Beneficial Owner cannot be accurately determined due to the Opaque Offshore Structure.”

A reportable taxpayer is only required to report if they are resident in the United Kingdom and a user of a CRS avoidance arrangement or a beneficial owner under an opaque offshore structure. They are only required to report in certain circumstances where an intermediary does not have to make the report themselves (See IEIM722020)

The Model Rules definition also refers to a “potential user” of an arrangement. This definition is construed narrowly and there has to be a clear link between the arrangement and the taxpayer. For example, if an adviser mentions the arrangement to a client in passing, but the client has no interest in implementing it, and no work is undertaken to consider whether the arrangement is appropriate to the client’s circumstances, it is unlikely that the client would be considered a potential user of the arrangement. However, if a client takes interest in a promoter’s CRS avoidance arrangement and work is done by the promoter on how such an avoidance arrangement could be implemented by the client, then is it likely that the client will be a potential user of a CRS avoidance scheme and come into the definition of a reportable taxpayer.