FATCA Regulatory Timelines

Transcription

1 FATCA Regulatory Timelines Including Final Regulations and Model Intergovernmental Agreements 12 February Version 2 This document was not intended or written to be used, and it cannot be used, for the purpose of avoiding US federal, state or local tax penalties. This includes penalties that may apply if the transaction that is the subject of this document is found to lack economic substance or fails to satisfy any other similar rule of law. This document has been prepared pursuant to an engagement between PricewaterhouseCoopers LLP and its Client and is intended solely for the use and benefit of that Client and not for reliance by any other person.

2 As of 12 Feb FATCA Timeline For US Agents Including USFIs (Note 1) Jun 30 review of entity account holders that are prima facie s Dec 31 documentation of remaining non- US entity (Note 1) Jan 1 Enhanced account opening procedures must be in place to establish FATCA status of new entity-owned Jan 1 Cut-off date for grandfathered obligations (Note 3) Jan 1 Begin FATCA withholding on US source FDAP income and NPs Jan 1 Begin FATCA undocumented entity withholding on gross proceeds Dec 2 First IRS list of Ps and RDCs to be published Jul 1 Begin FATCA withholding on entity account holders that are undocumented prima facie s Mar 15 Begin Form 1042-S reporting on US source FDAP income paid in calendar year Mar 31 Begin Form 8966 reporting with respect to US owned foreign entities and ownerdocumented s for calendar year (Note 4) Form 1042-S reporting for calendar year 2017 must include gross proceeds. (1) FATCA does not require US withholding agents to identify individual account holders, however, they must identify individuals under other withholding and reporting rules. (2) A account is subject to withholding prior to the end of the due diligence time period if the account owner documents itself as an NP. (3) Generally applies to obligations that can produce a withholdable payment. Grandfathered obligations also include: (1) any obligation that gives rise to a withholdable payment solely because the obligation is treated as giving rise to a dividend equivalent pursuantto section 871(m) and the regulations thereunder, provided thatthe obligation is executed on or before the date that is six months after the date on which obligations of its type are first treated as giving rise to (4) requirements include the name, address and TIN of the US owned foreign entity or owner documented, the total of all payments made to the entity, the account balance or value, and the name, address and TIN or each substantial US owner or specified US person, as the case may be. This document was not intended or written to be used, and it cannot be used, for the purpose of avoiding US federal, state or local tax penalties. 2

3 As of 12 Feb FATCA timeline for Ps in non-iga countries (For agreements effective on Dec 31, ) Governance July 15 - IRS portal available (Note 1) Oct 25 Last day to register for inclusion on the Dec 2, IRS list of Ps and RDCs Dec 2 -First IRS list of Ps Dec 31 Earliest effective date of an Agreement Jun 30 review of entity account holders that are prima facie s Jan 1 Enhanced account individual and entity Jan 1 Cut-off date for grandfathered obligations (Note 4) Jan 1 Begin FATCA income for all new and NPs Jul 1 Begin FATCA withholding on entity account holders that are undocumented prima facie s Dec 31 high value individual Jan 1 Begin FATCA withholding on any undocumented individual high value account Mar 15 Begin FATCA reporting on Form 1042-S for US source FDAP income for calendar year Mar 31 Limited 8966 for calendar years & for US (Note 5) Mar 31 Begin aggregate 8966 for recalcitrant Jan 1 Expanded affiliated group transition period ends for Limited s and Limited Branches Feb 29 Responsible officer must be able to certify completion of review for all individual and entity Dec 31 remaining individual and entity (Note 3) Jan 1 Begin FATCA undocumented Mar 15 Form 1042-S reporting must include foreign reportable amounts paid to NPFIs during calendar year (also applies to calendar year ) Mar 31 Limited 8966 for calendar year includes income payments Dec 31 - Last day for qualification as Limited Life Debt Investment Entity Dec 31 - End of first compliance certification period Jan Interests previously issued in bearer form must be redeemed or immobilized Jun First Certification of Compliance and Effective Controls required withholding on gross proceeds. FATCA withholding is also expected to begin for foreign passthru payments. Mar Full FATCA reporting on Form 8966 begins for calendar year Begin FATCA reporting on Form 1042-S for US gross proceeds and potentially foreign pass-thru payments for calendar year 2017 (1) The IRS has committed to making the portal available no later than July 15,. Thus, it could be available earlier. (2) As part of the certification, must also certify that it did not have any procedures in place from August 6, 2011 that would assist account holders in the avoidance of FATCA. (3) Certain de minimis thresholds and retesting rules may apply. (4) Generally applies to obligations that can produce a withholdable payment. Grandfathered obligations also include: (1) any obligation that gives rise to a withholdable payment solely because the obligation is treated as giving rise to a dividend equivalent pursuant to section 871(m) and the regulations thereunder, provided that the obligation is executed on or before the date that is six months after the date on which obligations of it s type are first treated as giving rise to (5) Limited reporting includes name, address, TIN, account number, and account balance of each specified US person who is an account holder. For account holders that are treated as US owned foreign entities and owner-documented s for reporting purposes, report name, address and TIN (if any) of such entity and each substantial US owner of such entity or spec ified US person. This document was not intended or written to be used, and it cannot be used, for the purpose of avoiding US federal, state or local tax penalties. 3

4 As of 12 Feb FATCA timeline for s under Model I IGAs (Note 1) governance July 15 - IRS portal available Oct 25 Last day to register for inclusion on the Dec 2, IRS list of Ps and RDCs Dec 2 -First IRS list of Ps Jan 1 Earliest date that an can be a Partner Country FI Dec 31 high value individual (Note 3) Dec 31 remaining individual and entity (Note 3) (Note 5) Jan 1 Enhanced account (Note 4) Jan 1 Begin FATCA income for NPFIs (Note 5) Jan 1 Cut-off date for grandfathered obligations (Note 6) Prior to Sep 30, FATCA Partner FI will need to provide required information to FATCA Partner prior to IGA deadlines in order for FATCA Partner to be able to meet corresponding deadlines (Note 7, 8) FATCA Partner FI to report to FATCA Partner Country the name and the aggregate amount of payments made in and to NPFI (Note 7) 2018 FATCA Partner FI to obtain and report TIN of each specified US account holder for (Note 7) (1) IGA: Intergovernmental Agreement. (2) The IRS has committed to making the portal available no later than July 15,. Thus, it could be available earlier. (3) pre-existing Accounts is subject to the application of thresholds (4) Dates for withholding on gross proceeds and passthru payments are highly speculative and will be worked out between the US and FATCA partner countries in the next two years. (5) appliesto US source income paid to nonparticipating financial institutions by reporting FATCA Partner financial institutions acting as a withholding QI, withholding foreign partnership or withholding foreign trust. Other reporting FATCA Finanical Institutions must provide information necessary to allow an immediate payor to withhold. (6) Generally applies to obligationsthat can produce a withholdable payment. Grandfathered obligationsalso include: (1) any obligation that gives rise to a withholdable payment solely because the obligation is treated as giving rise to a dividend equivalent pursuant to section 871(m) and the regulations thereunder, provided that the obligation is executed on or before the date that is six months after the date on which obligations of its type are first treated as giving rise to dividend equivalents; (2) with respect to foreign passthru payments, any obligation that is executed on or before the date that is six months after the date on which final regulations defining the term foreign passthru payment are filed with the federal register; and (3) any agreement requiring a secured party to make a payment with respect to, or to repay, collateral posted to secure a grandfathered obligation. (7) Dates will be provided under legislation or regulations issued by FATCA Partner tax authorities. (8) For and reporting is limited to: name, address, U.S. TIN (date of birth for preexisitng if no U.S. TIN), account number, name and identifying number of the reporting institution, and account balance or value. For reporting includes the information reported for and, plus the income paid to the account. For and beyond, reporting includes the information reported for plus proceedsfrom the sale of property. This document was not intended or written to be used, and it cannot be used, for the purpose of avoiding US federal, state or local tax penalties. 4

5 As of 12 Feb FATCA timeline for s under Model II IGAs (For agreements effective on Dec 31, ) Governance July 15 - IRS portal available (Note 1) Oct 25 Last day to register for inclusion on the Dec 2, IRS list of Ps and RDCs Dec 2 -First IRS list of Ps Dec 31 Earliest date that an can be a Partner Country FI Jun 30 review of entity account holders that are prima facie s Dec 31 high value individual Jan 1 Expanded affiliated group transition period ends for Limited s and Limited Branches Feb 29 Responsible officer must be able to certify completion of review for all individual and entity Dec 31 remaining individual and entity (Note 3) Jan Interests previously issued in bearer form must be redeemed or immobilized Jun First Certification of Compliance and Effective Controls required Dec 31 - Last day for qualification as Limited Life Debt Investment Entity Dec 31 - End of first compliance certification period Jan 1 Enhanced account individual and entity Jan 1 Cut-off date for grandfathered obligations (Note 4) Jan 1 Begin FATCA income for all new and NPs Jul 1 Begin FATCA withholding on entity account holders that are undocumented prima facie s Jan 1 Begin FATCA withholding on any undocumented individual high value account Mar 15 Begin FATCA reporting on Form 1042-S for US source FDAP income for calendar year Mar 31 Limited 8966 for calendar years & for US (Note 5) Mar 31 Begin aggregate 8966 for non-consenting Jan 1 Begin FATCA undocumented Mar 15 Form 1042-S reporting must include foreign reportable amounts paid to NPFIs during calendar year (also applies to calendar year ) Mar 31 Limited 8966 for calendar year includes income payments withholding on gross proceeds. FATCA withholding is also expected to begin for foreign passthru payments. Mar Full FATCA reporting on Form 8966 begins for calendar year Begin FATCA reporting on Form 1042-S for US gross proceeds and potentially foreign pass-thru payments for calendar year 2017 (1) The IRS has committed to making the portal available no later than July 15,. Thus, it could be available earlier. (2) As part of the certification, must also certify that it did not have any procedures in place from August 6, 2011 that would assist account holders in the avoidance of FATCA. (3) Certain de minimis thresholds and retesting rules may apply. (4) Generally applies to obligations that can produce a withholdable payment. Grandfathered obligations also include: (1) any obligation that gives rise to a withholdable payment solely because the obligation is treated as giving rise to a dividend equivalent pursuant to section 871(m) and the regulations thereunder, provided that the obligation is executed on or before the date that is six months after the date on which obligations of it s type are first treated as giving rise to (5) Limited reporting includes name, address, TIN, account number, and account balance of each specified US person who is an account holder. For account holders that are treated as US owned foreign entities and owner-documented s for reporting purposes, report name, address and TIN (if any) of such entity and each substantial US owner of such entity or spec ified US person. This document was not intended or written to be used, and it cannot be used, for the purpose of avoiding US federal, state or local tax penalties. 5