Recently, many friends have come to me to discuss CRS issues, probably because everyone has made money in the US stock market and then remembered they need to understand tax issues🤣

Many friends already know that using US brokers can isolate them from CRS, such as Charles Schwab, Interactive Brokers, or BIT, which was formerly Matrixport. This is because the United States has not joined CRS, so there is no data exchange under CRS.

(Among them, BIT's license is in Bhutan, which does not have diplomatic relations with China, and BIT is also the first regulated US stock brokerage platform for digital currencies.)

However, using a US broker does not completely avoid CRS issues, the answer is no, because CRS involves not only brokers but also banks.

That is to say, if your stock system is not operating under CRS, but the funds are under CRS, then data will still be submitted to CRS member countries. Many friends might find it difficult to open a bank account in the US, with most choosing a Hong Kong card. Although there are no issues with capital inflow and outflow from Charles Schwab and Interactive Brokers using a Hong Kong card, Hong Kong banks are part of the CRS system.

If you are a Chinese tax resident and have an account in a Hong Kong bank, then the Hong Kong bank will identify you as a Chinese tax resident and report the account information to the Hong Kong Inland Revenue Department (IRD).

Then, the Hong Kong Inland Revenue Department will exchange the information with the Chinese tax authorities through the AEOI mechanism.

This means some friends are trading US stocks through US brokers, but because the funds still have to return to banks under the CRS system, ultimately all funds are still exposed under CRS.

Especially for friends in the domestic cryptocurrency space, if they can directly use USDT or USDC for capital inflow and outflow, and if the broker's attributes are not within the CRS system, it could be more convenient.

In fact, Interactive Brokers can accept USDC deposits in certain countries and regions, but there are restrictions on deposits, and withdrawals can only be in fiat currency. BIT is somewhat better in this regard, as it allows direct deposits and withdrawals with various cryptocurrencies like USDT and USDC, essentially bypassing the CRS system.

Of course, I must also mention that paying taxes in accordance with the law is an obligation of every citizen. Tax issues should still be handled with caution.

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