Income Tax Act — I-3.3 275
Due diligence – preexisting entity accounts 275 (1) Unless the reporting financial institution elects otherwise — either with respect to all preexisting entity accounts or, separately, with respect to any clearly identified group of those accounts — a preexisting entity account with an aggregate account balance or value that does not exceed 250,000 USD on June 30, 2017 is not required to be reviewed, identified or reported as a reportable account until the aggregate account balance or value exceeds 250,000 USD on the last day of any subsequent calendar year. Application of subsection (4) (2) The review procedures set forth in subsection (4) apply to a preexisting entity account if it has an aggregate account balance or value that exceeds 250,000 USD on (a) June 30, 2017; or (b) the last day of any subsequent calendar year. Determination of reportable accounts (3) With respect to preexisting entity accounts described in subsection (2), the only accounts that shall be treated as reportable accounts are accounts that are held by (a) one or more entities that are reportable persons; or (b) passive NFEs with one or more controlling persons who are reportable persons. Review procedures — preexisting entity account (4) If this subsection applies to a preexisting entity account, a reporting financial institution must apply the following review procedures to determine whether the account is held by one or more reportable persons or by passive NFEs with one or more controlling persons who are reportable persons: (a) review information maintained for regulatory or customer relationship purposes (including information collected in accordance with AML/KYC procedures) to determine whether the information indicates that the account holder is resident in a reportable jurisdiction and, if so, the reporting financial institution must treat the account as a reportable account unless it (i) obtains a self-certification from the account holder to establish that the account holder is not a reportable person, or (ii) reasonably determines, based on information in its possession or that is publicly available, that the account holder is not a reportable person; and (b) with respect to an account holder of a preexisting account (including an entity that is a reportable person), the reporting financial institution must determine whether the account holder is a passive NFE with one or more controlling persons who are reportable persons and for the purposes of (i) determining whether the account holder is a passive NFE, the reporting financial institution must obtain a self-certification from the account holder to establish its status, unless it has information in its possession or information is publicly available, based on which it can reasonably determine that the account holder is (A) an active NFE, or (B) a financial institution other than an entity described in paragraph (b) of the definition investment entity that is not a participating jurisdiction financial institution, (ii) determining the controlling persons of an account holder, a reporting financial institution may rely on information collected and maintained in accordance with AML/KYC procedures, and (iii) determining whether a controlling person of a passive NFE is a reportable person, a reporting financial institution may rely on (A) information collected and maintained in accordance with AML/KYC procedures in the case of a preexisting entity account held by one or more NFEs with an aggregate account balance or value that does not exceed 1 million USD, or (B) a self-certification from the account holder or the controlling person indicating the jurisdiction in which the controlling person is resident for tax purposes. Timing of review (5) Each preexisting entity account must be reviewed in accordance with subsection (4) before (a) 2020, if the account has an aggregate account balance or value that exceeds 250,000 USD on June 30, 2017; or (b) the end of the calendar year following the year i