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Borderless accounts and tax

Will you report my transfers to the tax authorities?

TransferWise Limited is a UK company authorised by the Financial Conduct Authority as an Electronic Money Institution. We are still evaluating the impact of the Common Reporting Standards, including FATCA, to our business and how we will adopt the new requirements. At this time we are not reporting this information to HMRC or any other tax authority.

Who do I have to report my taxes to?

Customers are required to disclose and pay any necessary taxes associated with transfers made through our systems. 

The triggering of a tax liability and/or reporting obligation will depend on your tax residency, the nature of the income/gains and potentially the amount. We recommend you seek tax advice if you are unclear on the implications of a specific transaction.

Does TransferWise charge any taxes?

TransferWise does not levy any tax on its transfer fee. This means you will not be charged Value Added Tax (VAT), Goods and Services Tax (GST) or any other indirect tax.  There are some exceptions for Brazilian Real (BRL) transactions where IOF (Imposto sobre Operações Financeiras - financial operations tax) may be imposed by our banking partner(s).

TransferWise will pay out the agreed amount to the recipient and will not withhold any taxes on money transferred.  Depending on the nature of a transfer the payee and/or the recipient may have their own obligation to declare and pay tax. TransferWise cannot advise whether tax applies to your transfer and recommends you ask a financial advisor and/or the relevant tax authority.

If I open a EUR account (through the German bank, Deutsche Handelsbank) do I need to submit a tax declaration in Germany?  Or pay any German tax on my borderless account?

The borderless account itself will not create a taxable presence (commonly referred to as a permanent establishment). Assuming you have no other assets or activity in Germany, you will have no tax obligations including German tax return filings.

How does having a borderless account impact my taxes?

Assuming you are UK tax resident, most income/gains are taxed on a worldwide basis irrespective of the bank account location where the funds are remitted to. There are different rules for ‘non-domiciled’ individuals, also known as non-doms.

Is my borderless account considered within the UK for non-domiciles or non-doms?

Yes,our borderless account is considered to be UK situs. If you  convert to GBP it will be treated as remitted in the UK.

Please note - The above information is based on UK tax law, so you may need to check this information with your own tax authority if you have any more specific questions.

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