International tax compliance for expats

International tax compliance for expats

Last update on December 11, 2018

As expats need to declare their worldwide income and assets, it’s important that all investments and tax declarations meet international standards. [Contributed by ING Belgium]

Banking in Belgium – ING Expats have at least two countries in their lives: their home country and their host country. During their lifetime expats often build up assets in those two countries, and career expats in many more countries. Expats may also keep a house or an apartment in their home country and even buy one in their host country. Yet, declaration of their worldwide income, from financial assets and often real estate assets too, has to be done in the country where one has his or her fiscal residency. In many cases that is the host country, but there are quite a few exceptions, for example, for diplomats, international civil servants and even some executives benefitting from a special tax status in the host country.

In recent years the possibilities of cross border control by the tax authorities have substantially increased and ever more transparency is on the horizon, even in an automatic way.

International tax compliance for expat investments

The European Savings Directive started to install a system of automatic information exchange of ‘interest’ income between the tax authorities of the European Union Member States (and Associated Territories), and some other states, already more than a decade ago. Now there are plans to enlarge the scope of this Directive to include even more financial products.

The US Tax Authorities have implemented FATCA (Foreign Account Tax Compliance Act) to make sure that US persons declare all their worldwide income also in the US.

Learning from those experiences the OECD (The Organisation for Economic Co-operation and Development) is working on a ‘template’ for automatic financial information exchange between all its Member States too. Their plans should see implementation as early as in 2016 or 2017.

Any person has always typically been required to make a tax declaration for his or her worldwide income in the country where he or she is a fiscal resident, but now there is no room for omissions left. This is the age of transparency and thus there are no such things as real bank secrecy anymore, if it ever existed.

All in all it is ever more important to invest with parties who are themselves compliant with all those rules and regulations and who provide all the information needed for you as an expat to comply too. Beware of parties that make you proposals to hide your money from the competent tax authority(-ies).

Check out your personal situation and where needed start the necessary corrections. It is always better (cheaper) to contact the Fiscal Authorities yourself first than to wait for them to find you through all these means of international information exchange.


Contributed by Dave Deruytter, Head of Expats and Non-Residents / ING Belgium 

ING Bank Belgium