Fight against black money- Swiss bank shares Indian owned real estate assets’ information

The Indian government signed an Automatic Exchange of Information (AEOI) pact with Switzerland as a milestone step to fight against black money. As per this exchange program, India will receive the third set of Swiss bank account details that conveys the complete information about condominiums, flats and apartments owned by Indians in Switzerland. This move assumes to have an insight into the earnings acquired by such properties for a deep vision of the tax liabilities associated with them.

India received the first set of details from Switzerland in 2019, followed by the second in 2020 and the third in 2021, but it would be the first time that information about real estate assets is also shared. An Indian-origin entrepreneur, settled in Geneva, also stated that, “We find no valid reason for Swiss authorities to hide such information. After all, the ownership of property is not something which can be kept under wraps.”

People engaged in attracting investments to Switzerland also agreed that this transfer of information to the Indian government would clear the misconceptions about inflow of fund being illegal and Swiss bank’s long perception of being a safe haven for black money. To establish Switzerland as the chosen destination for real estate investments, having that level of transparency is mandatory.

According to the Swiss bank data, funds deposited by Indian individuals and firms through India-based branches or other financial institutions incurred a 13 year high jump of 2.55 billion Swiss francs in 2020, compared to 899 million Swiss francs in 2019.

Swiss bank’s total liabilities to their Indian clients amounted to CHF 2554.7 million, which includes CHF 2 million through trusts, CHF 503.9 million in customer deposits, CHF 383 million via other banks and the highest, CHF 1,664.8 million in the form of bonds or securities.

As per the AEOI pact, Swiss authorities have collaborated to share information regarding property speculation for clear tax functions, but the details about contributions to non-profit organizations and investments in digital currencies still remain out of reach.

The requests for this action have been at an increasing edge, with five names disclosed in October and November each, followed by twenty such requests in June. Generally, details like name, nationality and date of birth are required for an individual, and for the companies, name and their country of registration is mentioned. However, only the accounts that are officially named after Indians for business or other genuine purposes are taken into consideration.

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