CRS for residents in Spain and LATAM: real implications explained

120 countries since 2017. If you live in Spain or Latin America and hold accounts abroad, the OECD Common Reporting Standard directly affects what your tax authority knows. We break down what's reported, when, and why it matters for your US LLC.

CRS has been moving bank balances between more than 120 countries since 2017, and a Spanish tax resident with an account in Andorra, Switzerland or Mexico will see that data land at the tax office every September.

The Common Reporting Standard (CRS) is the most important piece of international tax compliance of the last decade, and very few people understand what it actually means for someone who owns a US LLC or holds bank accounts outside their country of residence. Let's break it down with technical precision and without alarmism.

CRS 2.0, CARF and DAC8 update (OECD package)

For residents of Spain and Latin America, the first concrete impact lands through DAC8: Directive (EU) 2023/2226 transposes CRS 2.0 + CARF into EU law and cascades down into the AEAT's Modelo 289 and the equivalent Latin American regimes that subscribe the updated MCAA.

The OECD adopted an integrated package combining CRS 2.0 (the revised Common Reporting Standard, which brings EMIs and specified electronic-money products into the perimeter and tightens due diligence on controlling persons) and CARF (the Crypto-Asset Reporting Framework, which extends automatic exchange to crypto exchanges, custodians and crypto-derivative platforms). The European Union transposed it through Directive (EU) 2023/2226 (DAC8), adopted on 17 October 2023, which amends Directive 2011/16/EU to incorporate both components. The substantive application date is 1 January 2026 and the first effective exchange lands in January 2027 over the prior reporting period.

Official sources: OECD — CRS, OECD — CARF, EUR-Lex — Directive (EU) 2023/2226 (DAC8).

The takeaway to remember is the same as always: the United States stays outside the CRS perimeter by architecture, not by opacity. Washington runs its own regime (FATCA), did not sign CRS 1.0 and will not sign CRS 2.0 — which is exactly why your US LLC remains a fully declarable structure in your country of residence. We unpack the full picture in CRS 2.0 and CARF: why the US will never sign and what it means for your LLC.

What CRS is and why it exists

The Common Reporting Standard was approved by the OECD Council in July 2014 in response to the G20 mandate after the financial crisis and the major tax-evasion scandals (LuxLeaks, Panama Papers). The objective is straightforward: tax authorities of adhering countries automatically exchange information about financial accounts held by non-residents.

Technically, CRS generalizes the previous model (FATCA) to more than one hundred jurisdictions, but on a multilateral rather than bilateral basis. Spain transposed it via Royal Decree 1021/2015 and Order HAP/1695/2016, which regulate Form 289 (the annual informative return that Spanish financial institutions submit to the AEAT, and which Spain receives in reverse from other adhering countries).

In Latin America CRS has been implemented, among others, in: Mexico (since 2017), Argentina, Colombia, Chile, Brazil, Uruguay, Panama, Peru, Costa Rica, Ecuador and the Dominican Republic. The United States, importantly, is not adhered to CRS. It runs its own system (FATCA), which is bilateral and outbound only, not inbound. We dive deeper into this in our article on whether US bank accounts report to your tax authority and, to understand why the US will not sign the new version either, in CRS 2.0 and CARF: why the US will never sign.

Regulatory framework

OECD: Common Reporting Standard, July 2014. Consolidated text and official commentaries.
EU: Council Directive 2011/16/EU on administrative cooperation (DAC), amended by DAC2 (Directive 2014/107/EU), which incorporates CRS into Union law.
Spain: Royal Decree 1021/2015, Order HAP/1695/2016, Order HAC/3625/2003 (Modelo 720), Order HFP/886/2023 (Modelo 721 for crypto-assets held abroad).
Multilateral Competent Authority Agreement (MCAA): the OECD instrument by which each country activates bilateral exchange with each of the others. Spain has activated exchange with virtually every EU country and with most adhering jurisdictions.

What information is reported exactly

Each Reporting Financial Institution (bank, broker, fintech with banking license, investment fund, insurance company with investment products) that detects an account holder whose tax residence differs from the country where the account is held must report:

The flow is annual, typically between May and September of the year following the reported period, and is then cross-checked against the taxpayer's filings (in Spain: IRPF, Modelo 720 and, after the latest reform, Modelo 721 for crypto-assets).

What happens with your US LLC: the nuance almost no one explains

Here is where the misunderstandings begin. Let's nail down the concepts:

The US does not send data via CRS. Mercury, Relay or any US regional bank will not directly send data to AEAT, SAT, DIAN or AFIP through CRS. What the US runs is FATCA, which is unilateral outbound: it requests data from foreign institutions about US-person accounts, but does not automatically send equivalent data the other way (it does in some cases through Model 1 IGAs, but at far smaller scope than CRS).
Your accounts at European fintechs in your LLC's name ARE reported. Wise (Belgium), Revolut (Lithuania, with the United Kingdom on its own post-Brexit regime), N26 (Germany) and Wallester (Estonia) are financial institutions subject to CRS in their jurisdictions. If the holder is your LLC and you are the beneficial owner tax-resident in Spain or LATAM, that data reaches your tax authority. We develop this further in our dedicated articles on Revolut and CRS and Wise and CRS.
Your LLC is most likely a passive NFE, unless it can demonstrate real operational activity (more than 50% of income is operational and not passive items such as dividends, interest, rents or royalties unconnected to a business). For the typical freelancer with a single-member LLC invoicing services, there is room for debate: a literal CRS reading would treat the LLC as an active NFE (operating business), but the European fintech typically classifies it as a passive NFE out of caution, which triggers reporting of the controlling persons. This nuance escapes almost everyone.

How CRS tax residence is determined

The financial institution applies a due diligence procedure (RD 1021/2015 and CRS Annex I) based on the holder's self-certification plus objective indicia: postal address, phone number, recurring IP, declared TIN, repeated transfer instruction to accounts in another country, powers of attorney granted to residents in another country.

If your self-certification states "tax resident in Andorra" but your IP, card delivery address and recurring transfers point to Madrid, the institution may request additional documentation (tax residence certificate issued by the competent tax authority, lease agreement, etc.) or, in case of doubt, report to both jurisdictions. False CRS self-certification is a tax offence in most jurisdictions and may carry criminal consequences if it concurs with material undeclared liabilities (in Spain, art. 305 of the Spanish Criminal Code if thresholds are crossed).

Real implications in Spain (Modelo 720 and Modelo 721)

If you are a Spanish tax resident and you have:

Foreign accounts with individual or aggregate balance above €50,000 at 31 December or as average balance in the last quarter: Modelo 720 informative return (see our complete guide to Modelo 720 and 721), first filing in March of the following year; subsequent filings only if there is a variation of more than €20,000 in any heading.
Foreign crypto-assets above €50,000 at 31 December: Modelo 721.
Foreign securities, rights, insurance, income above €50,000: Modelo 720, corresponding sections.

The CRS cross-check allows the AEAT to detect omissions almost in real time relative to the reported period. The CJEU judgment C-788/19 (27 January 2022) struck down the originally disproportionate sanction regime of Modelo 720 for being contrary to Union law, but the obligation to report remains fully in force with ordinary penalties (LGT art. 198) and with the qualifier that undeclared income may be regularised as unjustified capital gains (LIRPF art. 39, in what is not affected by the CJEU ruling). That is exactly why at Exentax we keep your calendar tight — you stop thinking about deadlines and we close them before they ever bite.

Real implications in LATAM

Mexico: art. 32-A of the CFF, annual RMF, cross-check with the annual return of individuals and corporates. SAT runs a specific audit programme on foreign accounts surfaced by CRS.
Colombia: DIAN integrates CRS into its exogenous information system. Omitted accounts may trigger an official assessment based on presumptive taxable income.
Argentina: AFIP receives CRS data and crosses it against its own informative regimes. The voluntary disclosure window is currently closed, so regularisation has to be done through a corrective return with interest and penalties. That is exactly why at Exentax we keep your calendar tight — you stop thinking about deadlines and we close them before they ever bite.
Chile: SII receives CRS data and crosses it with affidavit DJ 1929 (foreign-source income).
Uruguay and Panama: traditionally planning-friendly jurisdictions; both have adhered to CRS and report balances of non-residents.

How to plan correctly

The technical conclusion is the opposite of what many influencers say: a properly structured US LLC banking solely with Mercury or Relay (US) has minimal CRS footprint, because the US does not export CRS data. But as soon as you add a European layer (Wise, Revolut, Wallester, N26), you accept that the information will reach your tax authority. It is neither good nor bad: it just is, and planning requires knowing it.

The professional approach involves:

Filing correctly. The cross-check already exists; trying to hide is a waste of time and exposes you to penalties.
Designing the structure for the declared activity to be tax-efficient. This means deciding country of residence, investment instruments, remittance schedule, applicable deductions and the relevant Double Taxation Treaty. See our framework for designing a solid international structure.
Maintaining documentation: contracts, invoices, expense receipts, the LLC's books, consistent CRS self-certifications. Without documentation, an audit effectively shifts the burden of proof to the taxpayer. We close it with you from Exentax: one call, the filing goes out, the archive is set, and the risk stays on paper.
Knowing the risks of getting it wrong. We cover them in tax risks of bad international structuring.
Understanding your economic activity. A services LLC is not taxed the same way as an e-commerce or royalties LLC. We develop this in LLC taxation by economic activity.

Common mistakes we see every week

"Since Mercury is in the US, no one finds out." True for Mercury versus CRS, but false for your Wise, Revolut, Wallester or N26 accounts in the same LLC's name.
"I declared tax residence in Andorra, Paraguay or Dubai but I still live in Spain." Tax residence is not chosen; it is determined by facts (183 days, centre of economic interests, core of vital interests, art. 9 LIRPF). We develop this in our article on the tax residency of the digital nomad.
"If my LLC invoices, nothing happens to me." The AEAT may apply CFC rules (LIS art. 100, applicable to individuals via LIRPF art. 91) if your LLC generates passive income and the entity is under your control and located in a low-tax jurisdiction; the US is not a tax haven for these purposes, yet a pass-through LLC can still trigger the rule by the very mechanics of being a Disregarded Entity. Planning has to avoid that scenario, not ignore it.
"I'll put the account in a relative's name." This is the classic disguised nominee, whose criminal and tax implications we analyse in nominee owners and prestanombres in LLCs.

In summary

CRS is not "avoided" from a European jurisdiction. It is planned for, with knowledge. A US LLC remains an extraordinarily useful tool, but the design of your banking stack and your tax residency are decisive for the informational footprint you generate to be consistent with what you declare.

How to read CRS implications for Spanish and Latin American residents as a stable mapping of who is reported and to whom rather than as a country-by-country anecdote

CRS implications for Spanish and Latin American residents read more usefully as a stable mapping between the reporting financial institution, the residence declared on the account and the receiving tax administration, than as a country-by-country anecdote. The mapping doesn't shift with each anecdote.

Before going further, put numbers on your case: the Exentax calculator compares, in under 2 minutes, your current tax bill with what you would carry running a US LLC properly declared in your country of residence.

> Free consultation, no strings attached

Want us to review how CRS affects your specific case and design the right stack? Book your free consultation and we'll analyse it with you.

If something in this structure left you wanting more detail, why Spanish freelancers are leaving self-employment for a US LLC dives into a neighbouring piece of the puzzle that we usually keep for a separate write-up.

_More on this topic: Panama company: tax and residency, Offshore structures: real benefits and honest risks, From single-member to multi-member LLC: real tax implications before taking the step, Exit Tax in Spain: departure tax for crypto investors, LLC owners and Interactive Brokers users._

Next steps

If you want to validate whether this strategy fits your specific situation, at Exentax we review your case in person and propose the legal and efficient structure that truly suits you. Book an initial no-commitment session from our contact page.

Banking and tax facts worth clarifying

Fintech and CRS information evolves; here is the current state, exactly as it stands today:

Notes by provider

Mercury operates with several federally chartered partner banks and FDIC coverage via sweep network: mainly Choice Financial Group and Evolve Bank & Trust, with Column N.A. still in some legacy accounts. Mercury is not itself a bank; it is a fintech platform backed by those partner banks. If Mercury closes an account, the balance is typically returned by paper check mailed to the account holder's registered address, which can be a serious operational problem for non-residents; keep a secondary account active (Relay, Wise Business, etc.) as contingency.
Wise ships two clearly different products: Wise Personal (individual account) and Wise Business (business account, including for your LLC). For an LLC you must open Wise Business, not the personal account. Important CRS nuance: a Wise Business held by a US LLC sits outside CRS because the account holder is a US entity and the US is not a CRS jurisdiction; the USD side operates via Wise US Inc. (FATCA perimeter, not CRS). In contrast, a Wise Personal opened by an individual tax-resident in Spain or another CRS jurisdiction does trigger CRS reporting via Wise Europe SA (Belgium) on that individual. Opening Wise for your LLC does not bring you into CRS through the LLC; if you also keep a Wise Personal in your own name as a CRS-resident individual, that second one does report.
Wallester (Estonia) is a European financial entity with an EMI/issuing-bank licence. Its European IBAN accounts are within the Common Reporting Standard (CRS) and therefore trigger automatic reporting to the tax administration of the holder's country of residence.
Payoneer operates through European entities (Payoneer Europe Ltd, Ireland) that are also in scope for CRS for clients resident in participating jurisdictions.
Revolut Business: when paired with a US LLC, it operates under Revolut Technologies Inc. with Lead Bank as its US banking partner. The account delivered is a US account (routing + account number); no European IBAN is issued to a US LLC. The European IBANs (Lithuanian, Belgian) belong to Revolut Bank UAB and are issued to European clients of the group. If you are offered a European IBAN tied to your LLC, confirm exactly which legal entity holds that account and which regime it reports under.
Zero tax: no LLC structure delivers "zero tax" if you live in a country with CFC, tax transparency or income attribution rules. What you achieve is no double taxation and correct reporting at residence, not elimination.

References: legal framework and regulation

The reasoning of this article rests on the following regulation and doctrine, currently in force:

Spain. Personal Income Tax Law 35/2006 (arts. 8, 9 and 91 on tax residence and CFC rules), Corporate Income Tax Law 27/2014 (art. 100 on CFC), General Tax Law 58/2003, Law 5/2022 which reformed Modelo 720 after CJEU C-788/19 of 27/01/2022, RD 1065/2007 (Modelos 232 and 720) and Order HFP/887/2023 (Modelo 721 on crypto-assets held abroad).
Administrative doctrine. TEAC resolutions and binding consultations from the DGT on single-member LLCs (among others V0443-08, V1631-17, V1147-22), interpreted in light of the BOE notice of February 2020 on the classification of foreign transparent entities.
Treaties and international rules. Spain–US Double Taxation Treaty signed in 1990 with the 2013 Protocol in force since 2019, Directive 2011/16/EU as amended by DAC6, DAC7 and DAC8, and the OECD Model Convention with its Commentaries.
United States. Treas. Reg. §301.7701-3 (check-the-box classification), IRC §6038A and Treas. Reg. §1.6038A-2 (Form 5472), IRC §7701(a)(31) and FBAR rules (31 CFR 1010.350).

This content is informational and does not replace personalised advice for your specific tax situation.

What CRS means today for residents in Spain and Latin America

CRS runs on autopilot: more than 110 jurisdictions exchange data every September on year-end balances of the prior year. If you are tax resident in Spain, Mexico, Colombia, Chile, Peru, Argentina or Uruguay, the banks where you hold foreign accounts are already reporting or will be soon. This is what really matters, with no paranoia.

What is reported. Account balances at 31 December, gross annual income (interest, dividends), holder's name, tax residence declared to the bank and, for transparent entities, controlling person data. The information lands at the residence country and is crossed with the taxpayer's filing.
What is not reported. Detailed account movements, specific counterparties, transactional information. CRS is balances + gross income + identification; it is not transaction traceability. The "they know everything" perception is exaggerated literally but right in consequence: with balances and gross income they build enough presumption to open an inquiry.
Spain, Modelo 720 and Modelo 721. A Spanish tax resident has an own duty to declare foreign accounts (above €50,000 combined, Modelo 720) and foreign crypto-assets (above €50,000, Modelo 721). It does not depend on CRS, it depends on your duty. CRS only helps the AEAT to cross-check and detect omissions.
LATAM — different rhythms. Mexico (SAT) exchanges since 2018 with extensive coverage; Colombia (DIAN) since 2017 with progressive cleanup; Chile (SII) since 2018; Argentina (AFIP) since 2018 but with operational use still under construction; Uruguay active but with a tax-haven regime that nuances the flow in both directions. Use intensity varies but data availability is now generalised.

What we are asked the most

If I have Mercury in my LLC, does my country know via CRS? Not directly: the US does not participate in CRS. What does enter the flow is the Wise account (via Belgium) and, if the LLC operated from a European or Asian bank, those would too. Mercury sits outside the automatic flow, not outside every declarative duty.

How do I regularise if I have been unfiled for years? With a complementary 720 or 721 filing before an inquiry hits. CJEU ruling C-788/19 capped Spanish fines; you can regularise far more cheaply than five years ago. We assess each case.

At Exentax we map which of your accounts enter CRS, what declarative duties each one triggers and design the clean entry or the orderly regularisation when applicable.

Let's talk about your structure

Every case has nuances: your country of residence, the type of activity, where your clients are, whether you do investment or trading, whether you sell to consumers or to businesses. At Exentax we review your situation, design the LLC structure that fits you and accompany you each year on maintenance. Book a session with our team and we'll start from your real numbers.

Want to apply this protocol to your case? Book a session with the Exentax team and we will review your LLC with real numbers in thirty minutes, no commitment.

What if HMRC, the IRS or my local tax authority asks about my LLC?

It's the question every client raises in the first consultation, and the short answer is: your LLC isn't opaque, and a properly declared structure closes any inquiry in standard forms. Your tax authority can request the state Certificate of Formation (Wyoming, Delaware or New Mexico), the EIN issued by the IRS, the signed Operating Agreement, the Mercury or Wise statements for the year, the Form 5472 plus pro-forma 1120 you filed, and the bookkeeping that reconciles income, expenses and movements. If all of that exists and is delivered in order, the inquiry doesn't escalate.

What tax authorities do pursue, and rightly, is sham ownership (nominees, paper residency) and undeclared foreign accounts. A well-structured LLC is the opposite: you appear as beneficial owner in the BOI Report when applicable (verifiable at fincen.gov/boi), you sign the bank accounts and you declare the income where you actually live. The structure is registered with the state Secretary of State, with the IRS and, when European banks are involved, inside the CRS perimeter of the OECD standard.

The mistake that really sinks an inquiry isn't having an LLC; it's not attributing the income correctly in your domestic return, not declaring foreign accounts when the year-end balance exceeds the local threshold (€50,000 in Spain via Modelo 720; the equivalent FBAR / Form 8938 in the US for residents; T1135 in Canada), and not documenting related-party transactions between the member and the LLC. Those three fronts are worth closing before any request arrives, not after.

## What an LLC does NOT do

- It does not exempt you from tax in your country of residence. If you live in Spain, France, Germany or Portugal, you are taxed there on worldwide income. The LLC organises your US side (zero federal tax for non-resident SMLLC pass-through, absent Effectively Connected Income); it does not switch off your domestic taxation. The income tax is computed on the attributed profit, not on the dividends actually paid.

- It is not an offshore vehicle or a BEPS scheme. It is a US entity recognised by the IRS, registered in a specific state with physical address, registered agent and annual informational filings. Classic offshore jurisdictions (BVI, Belize, Seychelles) leave no public trace; an LLC leaves a trace in five different places.

- It does not protect you if you commingle funds. The pierce the corporate veil doctrine kicks in as soon as a judge sees the LLC and the member behaving as the same wallet: mixed accounts, personal expenses paid from the LLC, no signed Operating Agreement, no bookkeeping. Three suspicious transactions are enough.

- It does not save you social security contributions at home. If you are self-employed in Spain, France or Germany, your monthly social contribution remains identical. The LLC handles the trading side with international clients; your personal contribution is independent.

- It does not exempt you from declaring foreign accounts. Spain residents file Modelo 720 / 721; UK residents, the SA106; Portugal residents, the Anexo J of Modelo 3 IRS; Germany residents, the Anlage AUS. Those obligations belong to the individual, not to the LLC.

At Exentax we cover those five fronts every year alongside the US federal calendar (Form 5472, pro-forma 1120, FBAR, state Annual Report and BOI Report when applicable). The goal is that no inquiry finds a loose end and that the structure withstands a 5-to-7-year retroactive review.

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