Section 272 — Income Tax Act: General due diligence rules

An account is treated as a reportable account as of the date it is identified as a reportable account under the due diligence procedures set out in this section and in sections 273 to 277. The balance or value of an account is determined on the last day of the calendar year or other appropriate reporting period. For the purpose of determining whether the balance or value of an account exceeds a particular threshold on the last day of a calendar year, the balance or value must be determined on the last day of the last reporting period that ends on or before the end of the calendar year. A reporting financial institution may use service providers to fulfil its reporting and due diligence obligations imposed, but these obligations shall remain the responsibility of the reporting financial institution. A reporting financial institution may, either with respect to all preexisting accounts or, separately, with respect to any clearly identified group of those accounts, apply the due diligence procedures for new accounts to preexisting accounts (with the other rules for preexisting accounts continuing to apply); and for high value accounts to lower value accounts. Every reporting financial institution shall establish, maintain and document the due diligence procedures set out in this section and sections 273 to 277.