On 10 January 2025, the IOM Income Tax Division (“ITD”) published a new guidance note, GN63, relating to upcoming changes to their AEOI compliance programme, and specifically the introduction of onsite visits. The purpose of the guidance note is to outline the ITD’s intended approach to onsite visits which will assist Financial Institutions (“FIs”) prepare for such a visit.
The aim of the AEOI compliance visits is to ensure that IOM entities are:
- Classifying themselves correctly for AEOI.
- Completing the required due diligence procedures.
- Undertaking complete and accurate reporting for AEOI.
From our review of the Guidance Note, the following points are worth noting:
- A compliance visit is likely to be triggered by a known or perceived risk identified by the ITD from the data reported, information gathered (such as through the compliance returns), and/or intelligence held.
- The ITD aim to give 12 weeks notice before a visit.
- Where an entity is an Investment Entity by virtue of being managed by another FI, the ITD may conduct onsite visits to the managing entity’s premises to assess both its compliance with the applicable CRS regulations and that of any entities it manages.
- Information will be requested from an FI prior to the visit to allow the ITD to prepare for the visit. Such information is expected to be requested no later than 6 weeks prior to the visit.
- A pre-meeting will be held between the FI and the ITD before the onsite visit to confirm the scope of the ITD review and allow any questions to be addressed from either side.
- After the onsite visit, a meeting will be held between the ITD and the FI to allow the ITD to provide an overview of their findings and detail any remediation required. The ITD will then compile their findings into a report to provide to the FI.
