How is tax authority access to your EU bank accounts regulated?

Many of the clients of the international law firm Antwort Law, being tax residents of the EU, often ask questions about how accessible their bank accounts are to local tax authorities. In this article, we decided to examine this issue in detail and explain how tax authorities’ access to bank accounts of EU residents is regulated, as well as what is happening with the concept of bank secrecy and how it is interpreted in different countries.

Historically, bank secrecy has been an integral part of the financial systems of many countries, ensuring the confidentiality of client information. However, in the modern world, this concept has undergone significant changes. In the fight against tax evasion, terrorist financing and money laundering, states are increasingly introducing regulations that oblige banks to provide information about their clients to government agencies, including tax authorities.

Within the EU, bank secrecy practically does not apply to the interaction of banks with tax authorities. European directives and national laws allow tax authorities to access information about residents’ bank accounts, and this access is greatly facilitated by modern technology.

Today, tax authorities in EU countries have the right to direct access to information about their residents’ bank accounts. This means that banks are required to provide tax authorities with information about the movement of funds in accounts, balances, and other financial transactions. Moreover, in a number of countries, this access is carried out almost online, which allows tax authorities to receive up-to-date information in real time.

An example of a country where tax authorities not only have access to information, but can also directly influence a bank account is France. Here, the tax service can, for example, seize funds in a resident’s account if it is established that he or she is evading taxes. Such measures are used not only in France. In Germany, for example, tax authorities also have broad access to bank information, and in Italy they can seize accounts as part of a criminal investigation. These examples show that approaches to regulating tax authorities' access to bank accounts in EU countries may differ, but the trend towards increased control is evident across the union.

In addition to domestic regulation, an important aspect is the international exchange of information between countries. The Common Reporting Standard (CRS) developed by the Organisation for Economic Co-operation and Development (OECD) obliges member countries to exchange information on the financial accounts of non-residents. This significantly reduces the opportunities for tax evasion by hiding assets abroad.

Thus, the concept of banking secrecy in the EU is gradually losing its significance and is less and less protecting residents from government access to their financial information. Only rare exceptions are made for the protection of personal data and human rights, but even here strict rules defined by EU law apply.

For our clients, this means that they must be prepared to disclose their financial transactions to the state and take this into account when planning their financial affairs. We recommend that our clients take these changes into account and adapt their financial strategies accordingly in order to avoid possible legal and financial risks.

Antwort Law offers comprehensive tax planning, legal support and consulting services so that you can confidently conduct your affairs, knowing that all aspects of your financial security are taken into account. By contacting us, you will receive personalized solutions that will help you minimize risks, avoid legal problems and maintain control over your assets.

Lidia Ivanova

International lawyer
Antwort Law