User circumstances change over time—people move, change nationality, or alter their tax residency. CASPs must detect these changes and update their records accordingly.
What Triggers a Change?
Change in circumstances includes:
- Change of residence address
- Change of tax residency jurisdiction
- New nationality or citizenship
- Change in entity classification
- Change in controlling persons
- Information suggesting prior certification was incorrect
Monitoring Requirements
CASPs must monitor for changes through:
- User-initiated profile updates
- Transaction pattern analysis
- IP address monitoring
- Payment method changes
- Document expiration tracking
Implement automated rules to flag potential changes in circumstances, such as address updates to a different country or consistent login from new geographic locations.
Update Procedures
When a change is detected:
- Flag the account for review
- Contact user to confirm change
- Obtain new self-certification if needed
- Validate new TINs
- Update records with effective date
- Ensure correct reporting for each period
Record Keeping
Maintain audit trail of changes:
- Date change detected
- Source of change indication
- Old and new information
- Date user confirmed
- Supporting documentation
When a user's tax residency changes mid-year, you may need to report to both the old and new jurisdictions for that year, apportioned based on the change date.
System Implementation
Implement automated monitoring:
- Address change detection triggers
- IP geolocation alerts
- Document expiration reminders
- Annual re-certification prompts
- Workflow for change processing
Conclusion
Proactive change monitoring maintains data accuracy and ensures correct reporting. Implement automated detection supplemented by user self-reporting channels.
Automate CARF Compliance
Self-certification, TIN validation, transaction reporting, and XML generation for 76 jurisdictions.