For more than a decade, international tax cooperation has steadily expanded the scope of tax transparency, extending the automatic exchange of information from bank accounts to crypto-assets. Until recently, however, one significant blind spot remained: real estate held abroad. That gap is now beginning to close.
The OECD’s new multilateral initiative on the exchange of information relating to immovable property aims to establish an international framework through which tax authorities will systematically gain access to information on real estate owned outside their jurisdictions.
From Bank Accounts to Real Estate
This development is far more than a technical enhancement of the existing exchange of information framework. It represents the next logical step in the global drive towards greater tax transparency.
Over the past decade, tax authorities have gained unprecedented access to financial information through the Common Reporting Standard (CRS), while similar reporting obligations have gradually expanded to digital assets and online platforms. Until now, real estate remained one of the last major blind spots.
Without an automated information exchange mechanism, tax authorities have largely relied on administrative assistance requests and targeted tax audits to obtain information regarding overseas property ownership—processes that are inherently limited in both scope and efficiency. The new framework seeks to fundamentally change that reality.
What Will Change in Practice?
The principle underpinning the new system is straightforward: tax authorities will exchange information not on every property located within their jurisdiction, but on properties connected to tax residents of another participating jurisdiction.
This identification process will rely on key taxpayer information, including tax residency, taxpayer identification numbers and, crucially, information on the property’s beneficial owner. As a result, the focus shifts from the asset itself to the individual ultimately controlling it.
In practice, real estate abroad is gradually becoming part of the same transparency framework that already applies to bank accounts and other financial assets.
The Challenge of Beneficial Ownership
The greatest challenge does not concern properties directly owned by individuals. Such cases are generally easier to identify and assess.
The real complexity lies in ownership structures involving companies, special purpose vehicles (SPVs), trusts and other legal entities.
International tax policy has increasingly focused on looking beyond formal legal ownership to identify the ultimate beneficial owner. The same philosophy underpins the OECD’s new framework, making anonymous ownership structures progressively more difficult to maintain.
What Does This Mean for Taxpayers?
From a practical perspective, the new initiative does not necessarily create additional tax obligations. Rather, it significantly strengthens tax authorities’ ability to verify and cross-check information that already exists.
Taxpayers holding real estate abroad should therefore reassess not only the reporting of income derived from such assets, but also the transparency of their ownership structures.
As real estate becomes integrated into international information exchange systems, discrepancies between declared and actual ownership information are expected to become increasingly visible, enabling more targeted tax audits.
A Broader Shift in International Tax Transparency
Implementation will not be immediate. The multilateral agreement represents the first step towards establishing a global information exchange mechanism for real estate and will require participating jurisdictions to sign the agreement, incorporate it into their domestic legal frameworks and develop the necessary technical infrastructure.
According to the OECD’s current roadmap, the first automatic exchanges of information are expected to commence in 2029, covering data collected during previous years. This timeline demonstrates that the initiative represents a gradual transition rather than an immediate change affecting next year’s tax audits.
Despite the technical and operational challenges ahead, the direction is now clear. International tax transparency continues to expand across virtually every category of assets.
Ultimately, this development extends well beyond strengthening tax enforcement. It reflects a broader transformation of the international tax landscape, where transparency is becoming a defining feature of the global economic environment. In this context, comprehensive visibility over taxpayers’ cross-border assets is no longer a future aspiration—it is steadily becoming an operational reality.
The article was published at capital.gr