Guernsey issues bulletin to update draft guidance notes on FATCA-based reporting

On 21 November, the States of Guernsey Income Tax (ITO) published bulletin 2014/1 to update the most recent iteration of the draft guidance notes issued jointly by the crown dependencies on 28 July 2014 regarding the implementation under domestic law of FATCA-based reporting. The bulletin provides clarification in response to specific questions and comments received from industry by inserting additional text into existing draft guidance notes. This briefing note provides a summary of the additional text provided in the bulletin, which covers:

dual reporting for institutions that are treated as resident in a crown dependency and another jurisdiction for FATCA-based reporting;

the treatment of interests under employee benefit trusts;

clarification over the meaning of ‘regularly traded’ and ‘established securities market’, in the context of whether interests in listed vehicles are to be treated as financial accounts for the purposes of reporting; and

format and submission of reports.

Bulletin 2014/1 and the draft guidance notes published by the ITO will be of direct interest to Guernsey resident financial institutions as well as non-resident financial institutions that have a permanent establishment located in Guernsey through which they conduct the business of a financial institution, for the purposes of compliance with the UK-Guernsey IGA, signed on 22 October 2013; the US-Guernsey IGA, signed on 13 December 2013; and the OECD’s Common Reporting Standard (CRS), to which Guernsey, along with 50 other jurisdictions, signed up on 29 October 2014…