Almost everything said about the common reporting standard in advisory conversations is either an exaggeration or an understatement, and the two circulate together. One version holds that every movement in an offshore account is now visible to the client’s home authority in real time. The other holds that the data is so poor that nothing useful arrives. Both are wrong in the same way, which is that neither has read the schedule of what is transmitted.
The schedule is short and it is public. In the European Union it sits in article 8(3a) of Council Directive 2011/16/EU on administrative cooperation in the field of taxation, which governs the automatic exchange between Member States. Worldwide, the stocktaking report the OECD and the Global Forum presented to the G20 in July 2025 records that the vast majority of exchanges under the standard take place under the Convention on Mutual Administrative Assistance in Tax Matters, operationalised through the multilateral competent authority agreement, and the remainder under bilateral or regional agreements such as the directive itself. What follows is that schedule, what it means for a structure, and the three things it does not contain that clients most often assume it does.
A bilateral pipe, not a global database
The first correction is architectural. There is no central register of financial accounts. What exists is a network of exchange relationships between competent authorities, each of which has to be put in place before data moves along it, and each of which carries information about reportable accounts connected to the receiving jurisdiction. Under the directive’s definition, a reportable account is one held by one or more reportable persons, or by a passive non-financial entity with one or more controlling persons who are reportable persons, once identified as such under the due diligence procedures.
The reporting financial institution sends its data to its own authority. That authority sorts it by the residence jurisdiction of the reportable person, whether that is the account holder or a controlling person behind an entity account holder, and transmits each bundle to the corresponding authority. Under the standard, a bank in one jurisdiction does not send anything to a foreign tax office. It reports to its own tax authority, which forwards it.
The consequence is that the answer to whether an account is reported depends on at least two facts: whether the institution treats the holder, or, for a passive entity, any controlling person behind it, as resident somewhere reportable, and whether the exchange relationship with that somewhere has been activated. The scale is nonetheless substantial. According to the Global Forum’s 2025 annual report, as of 20 November 2025, 172 jurisdictions had joined the Global Forum, 116 had commenced exchanges under the standard and 12 more were committed to do so by 2027.
What is actually transmitted
The schedule in article 8(3a) covers identification, the account itself and the money in it.
On identification, article 8(3a) requires the name, address, tax identification numbers, and the date and place of birth of an individual account holder. For an entity account holder identified as having one or more controlling persons who are reportable persons, the entity’s name, address and tax identification numbers are transmitted together with the name, address, tax identification numbers and date and place of birth of each such person. The name and identifying number, if any, of the reporting financial institution is included, as is the account number or its functional equivalent.
On the money, the requirement is the account balance or value (including, for a cash value insurance contract or annuity contract, the cash value or surrender value) as at the end of the calendar year or other appropriate reporting period or, if the account was closed during that year or period, its closure. For a custodial account, the gross interest, gross dividends and other gross income generated in respect of the assets held in the account and paid or credited during the period, and the gross proceeds from the sale or redemption of financial assets paid or credited to the account where the institution acted as custodian, broker, nominee or otherwise as agent for the holder. For a depository account, the total gross amount of interest paid or credited. For other accounts, the total gross amount paid or credited to the holder in respect of which the institution is the obligor or debtor, including redemption payments.
The amendments made by Directive (EU) 2023/2226 add items about the file rather than the money, which the consolidated article 8(3a), as replaced by Directive (EU) 2025/872, requires to be communicated for taxable periods from 1 January 2026, subject for the roles to the transitional measures in section XI of Annex I: whether a valid self-certification has been provided for each account holder and for each reportable controlling person, the role by virtue of which each such person is a controlling person of the entity, the type of account, whether it is pre-existing or new, whether it is a joint account and how many joint holders it has, and, for an equity interest in an investment entity that is a legal arrangement, the role by virtue of which the reportable person holds it.
Gross means gross, and a balance is a snapshot
Two features of that data set are misread constantly and in opposite directions.
Gross proceeds from the sale or redemption of financial assets is not a gain. A portfolio that turned over twice in a year on a flat market reports proceeds equal to twice the portfolio, and reports no loss against them. A receiving authority looking at that figure sees a number far larger than any income the client had, which is why an unexplained CRS record so often produces an enquiry into a year in which nothing was earned.
The balance is the position on one day. It says nothing about what passed through the account, about the largest balance held during the year, or about a transfer made in December and reversed in January. Clients who assume the authority can see the flow are wrong. Clients who assume that a year-end figure can therefore be arranged are wrong in a more expensive way, because the pattern of arranged year-ends across several years is itself the signal.
The entity account and the person behind it
The provision that changed offshore practice is not the individual reporting. It is the treatment of entity accounts.
Where an entity is classified as a passive non-financial entity and one or more of its controlling persons is reportable, the account is reported with the entity’s details and with the details of each reportable controlling person, together, for taxable periods from 1 January 2026 and subject to the transitional measures in section XI of Annex I, with the role by virtue of which that person is a controlling person. The structure does not interpose anything. It adds a layer of description to the same disclosure.
That is why interposing an additional company rarely changes the reporting outcome and frequently worsens the file. It leaves the same natural person named as a controlling person, and it adds an entity that the receiving authority now knows exists, in a jurisdiction it can see, holding assets it can size. In one mandate we reviewed a chain of three entities created over six years, each intended to add distance, whose entire effect on the reported data was to change the description of the account holder while naming the same individual each time.
What the standard does not report
Three absences matter more than most of the content.
It does not report the source of the funds. Nothing in the schedule asks how the money arrived, who paid it, or what it was for. An authority receiving a balance has a figure and no explanation of it, which is why the natural follow-up is a request to the taxpayer rather than an assessment.
It does not report the transaction ledger. Counterparties, payment references and the timing of movements within the year are outside the standard entirely. The picture is annual and aggregated.
And it does not report an opinion. The institution transmits classifications it applied under the standard, not conclusions about whether the arrangement is proper. Where an authority forms a view, it forms it from the data plus whatever else it holds, and the standard is the part it did not have to ask for.
The absences are not comfort. They describe a record that is incomplete in exactly the way that invites questions, and the taxpayer is the only person who can complete it.
The calendar, and a lag that is longer than people think
Under article 8(6)(b) of the directive the communication is made annually within nine months following the end of the calendar year or other appropriate reporting period to which the information relates. The practical consequence is a gap, which can run to nine months after the end of the calendar year or other appropriate reporting period in which the event falls, between an event and the moment the receiving authority has the record of it, and a further gap before the record is worked.
That lag explains a pattern advisers see repeatedly. A client restructures, believes the matter closed, and receives an enquiry two years later about a position that no longer exists. The enquiry is not a sign that the authority is behind. It is the ordinary operation of a system in which the data arrives late and is then risk-assessed in batches.
The lag is also why remediation timed against an enquiry is almost always too late. The data describing the year in question was transmitted before anyone knew there was a question.
It cuts the other way as well. A position corrected today still leaves the records of earlier years already in transit or already delivered, describing the arrangement as it was. Any disclosure made now has to be consistent with those records rather than with the current structure, which is a point advisers reach late and clients find counterintuitive.
The scale, and what authorities do with the data
The volume is the part that has changed most since the early years of the standard. According to the July 2025 stocktaking report to the G20, information on over 171 million financial accounts was exchanged automatically in 2024, covering nearly thirteen trillion euros of assets held abroad. Alongside that, requests relating to at least thirty-two thousand taxpayers were made in the same year through exchange on request, which is the older and more targeted channel.
The measured effect is substantial rather than dramatic. Global Forum members report at least one hundred and thirty-five billion euros in additional revenues identified since 2009 through enhanced tax transparency and exchange of information, and studies cited in the same report record offshore bank deposits falling by four hundred and ten billion dollars, twenty-four per cent, by 2019.
Implementation quality is uneven in a way that matters for planning. The same report puts at eighty-nine per cent, as of 1 July 2025, the share of reviewed jurisdictions rated compliant or largely compliant on exchange on request, and at ninety-five per cent the share of assessed jurisdictions whose legal frameworks for the standard were determined to be in place or in place but needing improvement. A legal framework in place is not the same as data arriving usable, which is what the second round of effectiveness reviews, initiated in 2023, is meant to test, by seeking assurance that jurisdictions are implementing the standard effectively in practice.
Reading an exposure honestly
The right question about a structure is not whether it is reported. Assume it is. The right question is what the reported data will look like to someone who has nothing else, and whether the answer to the enquiry that follows already exists in writing.
That answer has three parts, and none of them come from the standard. The tax treatment of the income in the residence jurisdiction, documented contemporaneously. The reason the account is held where it is held, expressed as something other than confidentiality. And the source of the capital, evidenced by instruments that predate the account.
According to the Global Forum’s 2025 annual report, more than seventy jurisdictions have committed to implementing the crypto-asset reporting framework, with the first exchanges planned from 2027, which extends the same architecture to a class of assets many holders still treat as outside it. The design will be familiar: aggregated annual data, sent to the residence jurisdiction, with no explanation attached. The work of explaining it stays where it has always been, with the taxpayer, and it is materially easier to do before the data arrives than afterwards.
This article is informational and does not constitute tax or legal advice. The treatment of any structure depends on its facts and on the law of each jurisdiction involved. Each engagement is subject to scope and applicable regulation.