CRS 2.0 in Ukraine: What You Need to Know About the Expanded International Exchange of Financial Information

What does CRS 2.0 provide for?

CRS 2.0 is an update of the rules within the existing Common Reporting Standard (CRS) for the international automatic exchange of information.

The key changes concern three areas: broader coverage of digital financial products, clarified customer due diligence procedures, and more detailed information to be included in reporting.

1. Digital financial products: expanding the scope of CRS

One of the most significant changes is the inclusion in the CRS of categories related to digital finance, in respect of which information will now also be exchanged. These include:

• electronic money and equivalent products meeting the established criteria (Specified Electronic Money Products);

• digital fiat currencies issued by central banks (Central Bank Digital Currencies, CBDCs); and

• certain other virtual assets.

However, not every virtual asset or digital wallet is automatically subject to reporting: each specific product must be assessed against the established criteria.

In addition, the list of institutions that may be required to collect financial information and report it for exchange has been expanded – primarily institutions holding electronic money and CBDCs, as well as Investment Entities dealing in virtual assets. As a result, these changes are expected to increase the volume of financial information available to tax authorities.

! Important – CRS 2.0 does not introduce universal automatic reporting on all crypto-asset accounts, although such information may be taken into account for CRS 2.0 purposes. The international exchange of information on crypto-assets is governed by a separate framework, the Crypto-Asset Reporting Framework (CARF), under which information will first be collected for 2026, with the first automatic exchange between participating jurisdictions scheduled for 2027. However, Ukraine is not currently a participant in CARF.

2. Clarified rules on customer identification and account review

The updated rules amend the due diligence procedures applied by financial institutions to determine the status of Account Holders and identify Reportable Persons.

In particular, the requirements for assessing self-certifications and Documentary Evidence supporting the information provided have been clarified. The updated rules expressly set out specific circumstances in which information obtained by a financial institution from a customer may be considered incorrect or unreliable, including, in particular:

• reasonable doubts as to an individual’s tax residence where the individual claims tax residence in a jurisdiction where it can be obtained through high-risk citizenship / residence by investment (CBI/RBI) schemes;

• the absence of a taxpayer identification number (TIN) in the self-certification, even though the jurisdiction of tax residence issues TINs;

• receipt by the financial institution of information that contradicts the details provided in the self-certification.

This is relevant, in particular, for customers who hold accounts in several jurisdictions, declare multiple tax residences or open accounts through foreign companies. For example, it is clarified that information must be provided on all jurisdictions of tax residence, without applying the tie-breaker rules of double tax treaties.

3. More detailed reporting

The amendments also expand and clarify the list of information to be included in reports on Reportable Accounts.

Among other things, the updated rules require additional information to be reported on:

• whether self-certifications have been provided by Account Holders / Reportable Persons;

• whether the Reportable Account is a joint account and the number of joint Account Holders;

• the role by virtue of which control over the entity is exercised;

• the type of account and whether it is a Preexisting Account or a New Account;

• the equity ownership structure of certain Investment Entities.

4. Timing of application of the new rules

The CRS update naturally applies to accounts opened after the new rules take effect, but is not limited to them. It also provides mechanisms for reviewing previously opened accounts that have become Financial Accounts as a result of the expanded scope of CRS.

Special review deadlines have been set for such accounts:

• by 31 December 2026 – for High Value Accounts of individuals (exceeding USD 1 million) that have come within the scope of CRS as a result of the amendments. The first exchange in respect of such accounts will take place in 2027;

• by 31 December 2027 – for the relevant Lower Value Accounts of individuals (up to and including USD 1 million). The first exchange in respect of such accounts will take place in 2028.

Special transitional rules apply to certain accounts of companies and other Entities (partnerships, trusts, foundations, etc.). In particular, as a general rule, such accounts may not be required to be reviewed, identified or reported as Reportable Accounts until their aggregate account balance or value exceeds the equivalent of USD 250,000.

5. What does this mean for private clients and businesses?

Holders of foreign accounts and international structures should take the changes into account now. CRS 2.0 may lead not only to an increase in the volume of information transmitted to tax authorities under the automatic exchange, but also to a change in the classification of certain foreign structures for CRS purposes. This, in turn, may give rise to additional due diligence and reporting obligations and create compliance risks.