Can an owner still hide offshore accounts and shareholdings after CRS?

01What CRS actually exchanges

As the company goes abroad, the owner's own offshore accounts, shareholdings and funding arrangements come into the scope of tax information exchange too. This is not alarmism. It is a new normal that has to be faced, and it is tied to the decisions taken at company level.

Financial institutions in participating countries identify the tax residence of their account holders and report the account information back to the country of residence. Two points matter:

• The scope is not limited to personal accounts. The controlling persons behind a corporate account are identified as well — putting a layer of company between yourself and the account does not change the look-through logic.
• "Open the account somewhere else" is getting less realistic. The number of jurisdictions taking part keeps growing, so the search for a place that does not exchange is narrowing — and the cost and inconvenience of that search often exceed the compliant arrangement itself.

02CFC rules close the other end

Transparency is only the first step. Controlled foreign company (CFC) rules are about something else: the profits of an offshore company controlled by a resident may, where the conditions are met, be attributed and taxed — even if those profits are still sitting in the offshore company and have not been distributed.

For an owner operating abroad the direct implication is this: leaving profits inside an offshore shell and not distributing them may not achieve what you want it to. It draws attention more readily when that offshore company enjoys a local exemption and its effective tax burden is low.

This interacts with BOI exemption. Using promoted-status exemption to bring the Thai side of the tax down while not distributing profits home is a combination that has to be looked at through the CFC lens together with the control relationship, the effective tax burden and business substance. You cannot look at one side only. See whether BOI exemption plus undistributed profit falls within China's CFC rules and what a Thai profit passes through on its way back to China.

03Three steps — but do not rush to move

The response runs in three steps, in this order.

• First, take stock. Which accounts and shareholdings fall within the exchange, which reporting obligations they carry, and what the control relationships and retained profits of the offshore companies look like — draw the full picture before anything else.
• Second, assess the gap. Where the current position sits against what compliance requires, how the risk ranks, and whether any reporting gap has already arisen.
• Third, redesign. Rearrange in light of the corporate structure and the owner's own objectives, phasing the transition where that is necessary.

04The bigger mistake is moving before you have the picture

Structural change is better made early than late, but the bigger mistake is to act before the picture is clear. Transferring shares, closing accounts, changing control relationships — each of these leaves a trace of its own, and the timing matters. A position that was manageable and explainable can become hard to explain after one hasty adjustment.

One more thing. Arrangements at the personal level and structure at the company level are the same board, not two. Adjusting the personal side without looking at the company, or building the corporate structure without looking at the person, usually means pushing one problem down and having another surface. See what the corporate and shareholding structuring work covers.

How your residence status is determined, which accounts and shareholdings fall within the exchange, whether an offshore company reaches the CFC test, and how much room there is to adjust what already exists all have to be checked item by item against residence, control, the shareholding chain and past filings. This is not a question to handle from general statements. Take a full inventory first, then decide what to move.