overview of fatca and its implications on caribbean states...• the foreign account tax compliance...
TRANSCRIPT
Overview of
FATCA and its
implications on
Caribbean States
Presented by H. Wayne Lovell
October 30, 2012
3 © 2012 KPMG, a Barbados partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Barbados .The KPMG name, logo and
“cutting through complexity” are registered trademarks or trademarks of KPMG International.
Contents
■ What is FATCA and Why?
■ FATCA Tax Forms
■ FATCA Definitions
■ Is your business an FFI or NFFE?
■ Who is affected by FATCA?
■ Implications for the Caribbean
■ Consequences of not complying
■ Registration Process
■ Timelines
■ Steps to take now
■ Intergovernmental Agreements
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“cutting through complexity” are registered trademarks or trademarks of KPMG International.
What is FATCA and Why?
4
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What is FATCA and Why?
• The Foreign Account Tax Compliance Act (FATCA) was enacted on March 18, 2010.
• FATCA introduces a new reporting regime aimed at the disclosure of US persons with
offshore accounts and investments.
• The primary aim is to capture those US persons who obtain offshore accounts and
investments with the sole purpose of evading taxes. The US Treasury estimates it loses over
$100 billion per year because of tax evasion.
• This disclosure is accomplished by a new withholding regime (Chapter 4), that works in
tandem with the current withholding regime (Chapter 3).
• Chapter 4 imposes a penal withholding tax on withholdable payments made to foreign
financial institutions and other foreign entities that fail to comply with the disclosure
requirements.
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QI Background & Implications
Foreign intermediaries may enter into an agreement with the
IRS to act as a Qualified Intermediary (QI)
A benefit of the QI regime is that a non-US investor can
anonymously invest in the US, because tax Form reporting
provided by a QI is done on a pooled basis
Under the terms of its Agreement a QI undertakes to comply
with certain documentation, withholding and reporting
requirements
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“cutting through complexity” are registered trademarks or trademarks of KPMG International.
QI Documentation Disclosure Requirements
US Withholding Agent
Qualified Intermediary
IRS
Non-US
entity
Single Form W8-IMY
(includes QI-EIN)
QI Agreement
Separate Forms
W-9 for each US person
(and possibly separate
accounts as well);
Form 1099 reporting by
US withholding agent
(QI can elect to take on
this responsibility but
most do not)
US non-exempt
recipients
(receiving US
source income)
Forms W-8 or
documentary
evidence to QI. No
disclosure of non-US
persons to US
withholding agent or
IRS
US Person Non-US Person
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“cutting through complexity” are registered trademarks or trademarks of KPMG International.
US Tax Reporting For US Persons
US
WITHHOLDING
AGENT
IRS US PERSON
Reports payments made
to US persons on Form
1099 including
information on US
taxpayer (Form W-9)
IRS matches
Form1099 to
tax return
Files tax
return self
assessment
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“cutting through complexity” are registered trademarks or trademarks of KPMG International.
US Person
IRS QI
US Person files own
return
Form 1042 on pooled
basis
- no documentation
- no treaty benefit & withholding tax
Form 1099 – no tax
Dividend
$200
US Treasury
NON-US Person
IBM Stock
Form W-8BEN
Form W-9
Discloses $100 $100
$15
$0
Form 1042-S
Form
1099
$85
US Source Income
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US Individual
QI
Relies on US Individual
reporting
Not subject to US Tax
US Treasury
UK Individual
Foreign Stock
Discloses £100
£200
£100
Non-US Source Income
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FATCA Tax Forms
11
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“cutting through complexity” are registered trademarks or trademarks of KPMG International.
FATCA Tax Forms
FATCA TAX FORMS
Form W-8BEN -used by foreign person that is the beneficial owner of US source income
subject to withholding tax
-presented to withholding agent to establish foreign status and to claim any
benefits (treaty)
-used to claim exemption from US information reporting and backup
withholding
Form W-8EXP -used by foreign government, int‟l organisation, foreign Central Bank, etc
-presented to withholding agent to establish foreign status and to claim any
benefits (treaty)
-used to claim exemption from US information reporting and backup
withholding
Form W-8IMY -foreign person not acting for its own account
-used by foreign person to establish acting as QI
Form W-9 -to establish US status and to remove any presumption of foreign status e.g.
US citizen, resident alien, etc.
Form 1042-S -used to report certain payments to foreign persons of income subject to US
withholding tax
Form 1099 -used to report various categories of income earned by certain US persons
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FATCA Definitions
13
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FATCA Definition: Foreign Financial Institution (FFI)
A foreign financial institution is defined as any foreign entity that meets
at least one of the following:
• Accepts deposits in the ordinary course of a banking or similar business
• Is in the business of holding financial assets for the account of others
• Is primarily engaged in the business of investing, reinvesting, or trading in
securities, partnership interests (including futures or forward contracts or
options), certain commodities, or any interest in such instruments
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“cutting through complexity” are registered trademarks or trademarks of KPMG International.
Who is a Foreign Financial Institution (FFI)?
FFIs fall into three general categories:
Commercial Banks
Savings and Loan Associations
Credit unions
Co-operative banking institutions
Building Societies
Broker Dealers
Clearing Organisations
Trust Companies
Custodial Banks
Custodian with respect to assets of
Employee Benefit Plan
Commodity Pools
Managed Investment Funds
Collective Investment Vehicles
Life Insurance that issue cash products
A non-financial foreign entity (“NFFE”) is any foreign entity which is not an FFI
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“cutting through complexity” are registered trademarks or trademarks of KPMG International.
Foreign Financial Institution (FFI)
FFI
NPFFI
(Recalcitrant)
Effective agreement with IRS
No effective agreement with IRS –
subject to FATCA withholding
Where member of group may prevent
other members of group from attaining
PFFI status
PFFI
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“cutting through complexity” are registered trademarks or trademarks of KPMG International.
Foreign Financial Institution (FFI) (cont’d)
FFI
DCFFI
EFFI
Exempt from FATCA
withholding and
reporting provisions
Treated as NFFEs
Registered
Certified
Required to
Register with IRS
Not Required to be
Registered
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FATCA Definition: Deemed Compliant FFIs
Deemed compliant FFIs are FFIs that have a low inherent risk of US tax evasion and
are not required to enter into an FFI Agreement with the IRS
Deemed compliant with the requirements and exempt from withholding
Categories of deemed-compliant FFIs
Registered deemed-compliant FFIs: Required to register with the IRS to declare
status as deemed-compliant and to attest to the IRS that it satisfies certain procedural
requirements at periodic intervals.
Certified deemed-compliant FFIs: Not required to register with the IRS, but must certify
to withholding agent that it meets the requirements of its certified deemed-compliant
category on Forms W-8
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FATCA Definition: Non-Financial Foreign Entity (NFFE)
NFFE
not an FFI
Excepted
(ENFFE) General or Passive
(PNFFE)
Not subject to US FATCA
reporting and withholding
Subject to US FATCA reporting and
withholding
To avoid
-Provide certification to withholding agent that it has
no substantial US owner, or
- provide information on substantial US owner to
withholding agent
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“cutting through complexity” are registered trademarks or trademarks of KPMG International.
FATCA Definition: Withholdable, Passthru Payments and FDAP
• Withholdable Payments
Any payment of interest, dividends, rents, salaries, wages, premiums, annuities, compensations,
remunerations, emoluments, and other fixed or determinable annual or periodical gains, profits,
and income if such payment is from sources within the US.
AND
Any gross proceeds from the sale or other disposition of any property of a type which can
produce interest or dividends from sources within the US.
• Passthru Payments
Any withholdable payment or other payment to the extent attributable to a withholding payment.
The proposed regulations are reserved on the definition of a foreign passthru payment.
• FDAP income
Fixed or Determinable Annual or Periodical (FDAP) Income, generally includes any withholdable
payments.
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FATCA Definition : Recalcitrant account holder
An account maintained by a participating FFI (PFFI) that:
−Fails to comply with the PFFI‟s request for documentation or information to establish whether
the account is a US account
−Fails to provide a valid Form W-9 upon PFFI‟s request PFFI
−Fails to provide a correct name and TIN upon request after the PFFI receives notice from the
IRS indicating a name/TIN mismatch
−Fails to provide a valid and effective waiver of foreign law if foreign law prevents reporting with
respect to the account holder by the PFFI
Exceptions:
−FFI
−Account meets exception for US accounts with deposit accounts with a balance of $50,000 or
less
−Qualifies for documentation exceptions for preexisting accounts
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FATCA Definition: Financial Account (US Account)
• Any depository account maintained by FFI.
• Any custodial account
• Any equity or debt interest in an FFI, other than interests that are regularly traded on
an established securities market
• Any cash value insurance contract and annuity contract issued or maintained by an
FFI
Held by a specified US person or US owned foreign entity
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FATCA Definition: US Person
A US person is one who is
a citizen
a green card holder
meets the requirements as a "tax resident"
as evidenced by "indicia" of US account
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FATCA Definition: US Indicia
• Identification of any account holder as a US resident or US citizen
• A US address associated with an account holder of the account
• A US birth place for an account holder of the account
• An “in care of” address, a “hold mail” address (i.e. a request that the US Postal Service
hold mail for a specific address rather than deliver it-usually for a specific period of
time), or a US PO address that is the sole address on file with respect to the account
holder
• A power of attorney or signatory authority granted to a person with a US address
• Outstanding instructions to transfer funds to an account maintained in the US or
directions received from a US address.
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FATCA Definition: Exempted Beneficial Owners
• Foreign governments
• International organizations
• Foreign Central Banks of Issue
• Governments of US possessions
• Foreign Retirement Funds
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FATCA Definition: Expanded Affiliated Group
• Members of the group are determined where they are at least 50% owned by the
same parent, whether owned directly or indirectly.
• Partnerships and other entities shall be treated as a member of an expanded affiliated
group if such entity is controlled under US law by members of such group (including
any entity treated as a member of such group by reason of this sentence).
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Is your business an FFI or NFFE?
27
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“cutting through complexity” are registered trademarks or trademarks of KPMG International.
Foreign Financial
Institutions (FFI)
Accepts deposits
Holds financial
assets for others
Invests into securities &
Trades Securities
Is your business a FFI or NFFE?
Private
Equity
Companies
Funds
Banks
Foreign Financial
Institution
Non-Financial Foreign
Entity
An NFFE is any foreign
entity that is not an FFI.
Insurance
Companies
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Determining Entity Classification
From FFI database
Non-US
Entity US Entity
Tentative
FFI
Excepted NFFE
Passive NFFE Identify substantial US
ownership
Satisfies
Exclusion
Criteria
Satisfies
Deemed
Compliant
EFFI
Potential FFI
Identify FATCA Accounts
Satisfies
Excepted
NFFE
DCFFI
No
No
No
No Yes
Yes
Yes
Yes
Yes
No
Exempt from FATCA
withholding and reporting
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Who is affected by FATCA?
30
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Who is affected by FATCA?
• All banking, investment management/administration, fiduciary and life insurance entities need
to consider FATCA and assess its impact on their organisation.
• Any entity with US assets will be impacted.
• FATCA will apply to any person/entity that makes/receives withholdable payments.
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US Taxation assessed
Non-Resident Individual and
Corporations
US Resident Individual and domestic
corporations
On worldwide income
Who is affected by FATCA?
On US source income and limited
categories of foreign-source income
FDAP Connected to P.E.
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Implications for the Caribbean
33
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Implications for the Caribbean
FATCA is aimed at the offshore financial world, so you should expect that most of FATCA
will affect you, including withholding on US sourced:
■ Income/dividends
■ Gross proceeds of sale
■ Swap proceeds
Few "carve outs" and unlikely to include most offshore funds.
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Implications for the Caribbean
Under FATCA,
■ you are incentivised (by withholding regime) to capture information for the IRS on US citizens
investing abroad
■ Having no US stakeholders does not relieve the burden
■ Can you exist without being an FFI?
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Implications for the Caribbean
By becoming an FFI, you are committed to:
■ Implement internal policies, procedures and controls around “US accounts”
■ Increased burden of reporting (details not yet finalised)
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Implications for the Caribbean
Under FATCA
■ Foreign Financial Institutions (FFIs) are potentially subject to punitive 30% US withholding tax
on the Withholdable Payments (beginning January 1, 2014) and Passthru Payment
(beginning no sooner than January 1, 2017)
■ NonFinancial Foreign Entities (NFFEs) are also potentially subject to a punitive 30% US
withholding tax imposed on Withholdable Payments
(beginning January 1, 2014)
If 30% FATCA withholding is not required, then regular non-US person withholding rules
(Chapter 3) continue to apply.
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Implications for the Caribbean
• High costs of compliance.
• Changes in systems to accommodate reporting requirements.
• Reduces the probability of entering into Tax Information Exchanges Agreements (“TIEAs”)
and Double Taxation Agreements (“DTAs”) for those countries where such agreements do
not exist already.
• Possible reduction in management companies and banking relationships.
• May raise investor‟s concerns about the privacy and confidentiality of their information.
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“cutting through complexity” are registered trademarks or trademarks of KPMG International.
Implications for the Caribbean: Key Concepts
• The goals of FATCA are to identify US persons and have their investment information
provided to the IRS
• FFIs and NFFEs
• The FFI Agreement will require the FFI to identify US accounts and report them to the IRS on
an annual basis.
• Withholdable payments and “Passthru payments”
• All non-US entities that receive withholdable payments are affected
• Identification
• Due Diligence
• Withholding requirements
• Reporting requirements
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Implications for the Caribbean: New and existing account
documentation
FATCA requires that new account policies and procedures be developed to address:
■ Identification and due diligence requirements for all new accounts
■ Be in place as of the effective date of the FFI Agreement
FATCA also requires the review of existing account files to determine:
■ What documentation is in the files from a FATCA perspective
■ Reviewed by the timeline
■ Presumption rules in the absence of required information
■ Indicia of US status found for an existing account
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Implications for the Caribbean: Core components of FATCA compliance
FATCA Requirements FFIs
Enter into an FFI Agreement Required of all FFIs
Ensure measures are in place for new accounts Must be completed by all FFIs
Undertake prescribed due-diligence process on existing
accounts Must be completed by all FFIs
Put in place capability to withhold on passthru payments
to non-compliant FFIs (as well as recalcitrant accounts) Must be completed by all FFIs
Report to IRS on all US accounts Must be completed by all FFIs
Governance /compliance New processes required
Funds and other investment structures that comprise both US and foreign institutions,
will have varying compliance burdens depending on the domicile of operations:
A
B
C
D
E
F
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Implications for the Caribbean: Due diligence requirements under
FATCA
“Indicia” Required Documentation
a) US citizenship or lawful permanent resident (green card
holder)
• Form W-9
b) US place of birth • Form W-9 and obtain waiver (if applicable) or
• Form W-8BEN and
• Non US passport or similar government-issued document
establishing client‟s citizenship in a country other than US (if
applicable) and
• Written explanation regarding client‟s renunciation of US
citizenship or reason why client did not acquire US citizenship at
birth (if applicable)
c) Residence address or correspondence address in the US
(including US post office box)
• Form W-9 or
• Form W-BEN and non US passport or similar government-issued document
establishing client‟s citizenship in a country other than the US (if applicable)
d) Standing instructions to transfer funds to an account
maintained in the US or directions regularly received from
a US address
• Form W-9 establishing US status or
• Form W-8BEN and non documentary evidence establishing non-US status of
client (if applicable)
e) “In care of” or “hold mail” address that is the sole address
with respect to the client
• Form W-9 establishing US status or
• Form W-BEN and documentary evidence establishing non-US status of
individual account holding (if applicable) f) Power of attorney or signature authority granted to a
person with a US address
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Implications for the Caribbean: Information flows under FATCA
IRS
IRS
Withholding
Agent
Account
Holder(s)
Investor(s)
Others Substantial US
Owners
Foreign Financial
Institution (FFI)
Non-Financial Foreign
Entity (NFFE) Certification or
Information on
“Substantial US
Owners”
Others
Recalcitrant
Account Holders
US Account
Holders
Documentation
Reporting on NFFE
payments for
“Substantial US
owners”
Detailed reporting on US
A/C holders
+
Reporting on certain
other categories
FFI Certification
Documentation
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Implications for the Caribbean: Payment flows under FATCA
IRS
IRS
Withholding
Agent
Account
Holder(s)
Investor(s)
Others Substantial US
Owners
Foreign Financial
Institution (FFI)
Non-Financial Foreign
Entity (NFFE)
Others
Recalcitrant
Account Holders
US Account
Holders
“Passthru
payments”
Withholding on
payments to non-
compliant NFFEs
Withholding on
“recalcitrants” and
certain others
“Withholdable
payments”
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Implications for the Caribbean: Actions an FFI Must Do as a Part of its
FFI Agreement
• Obtain information regarding each account holder to determine which (if any) of such accounts are US accounts 1
• Comply with verification and due diligence procedures required by the IRS/Treasury with respect to the identification of US accounts 2
• If the FFI maintains US accounts, it must report on an annual basis certain account information to the IRS 3
• The FFI must deduct and withhold a tax equal to 30 percent on certain payments to recalcitrant account holders and non-participating FFIs
4
• An FFI must comply with requests by the IRS/Treasury for additional information with respect to any US account 5
• If foreign law prevents the reporting of any information the FFI must attempt to obtain a waiver from relevant account holders in a reasonable period of time or exit the account
6
Identify US accounts
Comply with due
diligence procedures
Report annually for US
accounts
Withhold on passthru
payments
Provide further
information on request
Obtain a waiver when
necessary
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“cutting through complexity” are registered trademarks or trademarks of KPMG International.
Consequences of not Complying
46
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“cutting through complexity” are registered trademarks or trademarks of KPMG International.
Consequences of Not Complying
FFI that did not enter into an FFI agreement
• will suffer 30% punitive withholding on any withholdable payment made by US withholding
agent.
• will suffer 30% punitive withholding on any passthru payment made by PFFI.
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“cutting through complexity” are registered trademarks or trademarks of KPMG International.
Consequences of Not Complying
FATCA withholding not applicable if:
• a PFFI that provides the withholding agent with valid documentation establishing FATCA is not
applicable.
• a deemed-compliant FFI; or
• an Exempt Beneficial Owner.
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“cutting through complexity” are registered trademarks or trademarks of KPMG International.
Consequences of Not Complying
Where a NFFE receives withholdable payments, the withholidng tax of 30% will apply
unless:
• the NFFE provides information on its substantial US owners
• the NFFE has no substantial US owners; or
• the NFFE is an excepted NFFE.
© 2012 KPMG, a Barbados partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Barbados .The KPMG name, logo and
“cutting through complexity” are registered trademarks or trademarks of KPMG International.
Registration Process
50
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“cutting through complexity” are registered trademarks or trademarks of KPMG International.
Registration Process
FATCA Administration
It is envisioned that foreign financial institutions will register for FFI status through an IRS online
registration system
For those entering into an FFI agreement , the process will also be completed in the registration.
Within the system, FFIs will identify certain key persons
Responsible Officer (RO)
Point of Contact (POC)
Authorized Third Party (ATP)
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“cutting through complexity” are registered trademarks or trademarks of KPMG International.
Timelines
52
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“cutting through complexity” are registered trademarks or trademarks of KPMG International.
FATCA Timeline – FFI (Previous)
D. 1 July 2013*
FFIs accountable for
identifying all new
„US accounts‟,
recalcitrants, and NPFFI
C. 30 June 2013
Deadline to enter into FFI
Agreements with IRS
(Safe harbor deadline)
E. 1 January 2014
Withholding begins on
non-compliant FFIs and
recalcitrants
2012 2013 2014 2015 2016 2017
G. 30 September 2014
Reporting to IRS begins
on „limited‟ basis
F. 30 June 2014*
Deadline for FFIs to
complete remediation
on all presumed FFIs
and high-value
accounts
H. 1 January 2015
Withholding begins on
non-compliant accounts for gross
proceeds payments
I. 30 June 2015*
Deadline for FFIs to
complete second stage of
diligence reviews (non-high
value accounts)
A. Autumn 2012
Final FFI Agreements
to be released
J. 31 March 2016
Begin IRS reporting on
US Source income paid
to „US‟ and recalcitrant
accounts
K. 1 January 2017
Earliest application of
passthru payments
withholding on foreign
source payments
B. 1 January 2013
FFI agreement application process
commences to IRS.
Grandfather rule: Payments made on
non-equity obligations (with a defined
term) outstanding as of January 1,
2013 are exempt from FATCA.
Begin tracking reportable data.
* These dates assume that the FFI’s agreement approved by the IRS is effective on 1 July 2013.
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“cutting through complexity” are registered trademarks or trademarks of KPMG International.
FATCA Timeline – FFI Updated
F. 31 December 2013
Deadline to enter into FFI
Agreement with IRS
(thereafter be considered NPFFI)
2012 2013 2014 2015 2016 2017
A. 8 February 2012
IRS published draft
FATCA regulations
E. Q1 2013
Final FATCA regulations
to be released
Final FFI Agreement to be
released
IRS to begin accepting FFI
agreement applications
I. 31 December 2014
Deadline for FFIs to complete
remediation on all high-value
accounts
H. 30 June 2014*
Deadline for FFIs to
complete remediation
on all prima facie FFIs
K. 31 December 2015*
Deadline for FFIs to complete
due diligence reviews for all
remaining accounts
C. August 2012
Drafts IRS forms
released
L. 31 March 2016
Annual IRS reporting on „US‟ accounts
and aggregate reporting on recalcitrant
accounts
Begin IRS reporting on accounts held
by NPFFIs
M. 1 January 2017
Withholding begins on
non-compliant accounts for
gross proceeds payments
Earliest application of passthru
payments withholding on
foreign source payments
G. 1 January 2014
FFI agreement becomes effective
FFIs accountable for identifying all
new „US accounts‟, recalcitrants,
and NPFFI
FATCA Withholding begins on
FDAP payments to certain account
holders
J. 31 March 2015
IRS reporting on „US‟ accounts and
aggregate reporting on recalcitrant
accounts for 2013 and 2014
N. 31 March 2017
Annual IRS reporting on „US
accounts‟ and aggregate
reporting on recalcitrant accounts
Last year of IRS reporting on
accounts held by NPFFIs
B. July 2012
Draft of Model I IGA
released
* These dates assume that the FFI’s PFFI agreement is approved by the IRS and is effective on 1 January 2014.
D. 1 January 2013
Grandfather rule: Payments
made on certain non-equity
obligations (with a defined
term) outstanding as of
January 1, 2013 are exempt
from FATCA withholding
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“cutting through complexity” are registered trademarks or trademarks of KPMG International.
FATCA Timeline - U.S. Withholding Agent
2012 2013 2014 2015 2016 2017
A. 8 February 2012
IRS published draft
FATCA regulations
F. Q1 2013
Final FATCA
regulations to be
released
I. 15 March 2015
Reporting begins on
“Chapter 4 reportable
payments” to the IRS begins
on forms 1042 and 1042-S
L. 1 January 2017
Withholding begins on
non-compliant accounts for gross
proceeds payments
G. 1 January 2014
Update Onboarding process for new
accounts to include Chapter 4
requirements.
FATCA Withholding begins on FDAP
payments to certain account holders
J. 31 March 2015
Reporting begins on certain US
Owners of Owner-Documented FFIs
& Passive NFFEs
C. August 2012
Draft IRS forms
released
B. 26 July 2012
Draft of Model I
IGA released
D. December 2012
Final versions of the
IRS Forms for
FATCA to be
released
H. 30 June 2014
Deadline for USWAs to
complete remediation on
all prima facie FFIs
E. 1 January 2013
Grandfather rule: Payments made on
certain non-equity obligations (with a
defined term) outstanding as of January
1, 2013 are exempt from FATCA
withholding
K. 31 December 2015
Deadline for USWAs to
complete remediation on all
remaining preexisting entity
accounts
© 2012 KPMG, a Barbados partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Barbados .The KPMG name, logo and
“cutting through complexity” are registered trademarks or trademarks of KPMG International.
Steps to take now
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“cutting through complexity” are registered trademarks or trademarks of KPMG International.
Steps to take now
■ Internal/External Education
■ Clarify FATCA ownership within the organization
■ Analyze and understand potential impact assessment
■ Entity analysis
■ Product/Service analysis
■ Account information and procedures
■ Consider impact on IT system(s)
■ Identify in-flight projects with synergies
■ Analyze and understand potential impact on business
■ Develop a initial plan
■ Communicate with value chain, customers and Treasury
© 2012 KPMG, a Barbados partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Barbados .The KPMG name, logo and
“cutting through complexity” are registered trademarks or trademarks of KPMG International.
Intergovernmental Approach
58
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“cutting through complexity” are registered trademarks or trademarks of KPMG International.
Intergovernmental approach – An Alternative Approach to FATCA
Alternative intergovernmental approach to FATCA implementation that would:
■ Address legal impediments to compliance
■ Simplify practical implementation
■ Reduce costs
Contemplates reporting by FFIs to their respective governments
US commits to reciprocity in collecting & reporting to FATCA partner
Where the US & FATCA partner have entered into an IGA, FFIs would:
■ Not enter into FFI agreement with IRS
■ Report on US accounts through their local government
■ Eliminate penal withholding requirement on recalcitrant account holders and FFIs in countries
that have entered in an agreement with US.
■ FATCA partner would report the FATCA information to US.
Question and
Answer session
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“cutting through complexity” are registered trademarks or trademarks of KPMG International.
Contact details
H. Wayne Lovell
Senior Director, Tax
Telephone: 1 246 434 3928
Marianne Greenidge
Senior Manager, Tax
Telephone: 1 246 434 3918
Tara Collymore
Senior Associate, Tax
Telephone: 1 246 434 3900
Thank you
© 2012 KPMG LLP, a Delaware limited liability
partnership and the US member firm of the KPMG
network of independent member firms affiliated with
KPMG International Cooperative (“KPMG
International”), a Swiss entity. All rights reserved.
NDPPS 113795
The KPMG name, logo and “cutting through
complexity” are registered trademarks or
trademarks of KPMG International.