FATCA reporting deadline is August 15
Financial institutions and other reporting entities have been given a deadline date of August 15, 2015, as it relates to registration with the Barbados Revenue Authority (BRA), for sending key information required under the Foreign Account Tax Compliance Act (FATCA).
Representing the Barbados Revenue Authority (BRA), Dava Leslie-Ward recently pointed this out to tax practitioners and reporting entities in the finance sector, giving them a better understanding of what will be required for FATCA reporting. Under FATCA, Barbados will exchange tax information with the United States concerning accounts held by Barbadian Financial Institutions on US persons and in turn, the US will exchange information with Barbados, in relation to accounts held by Barbadian citizens, in US Financial Institutions.
“Typically, we would expect that financial institutions transmit information to us by July 31, annually.
However, because this is the first year, you will find that at the end of the Act, there will be a transitional (period) which will stipulate the date of first transmission for this year only. So that transmission date is likely to be August 15 and it is for this year only. From next year, the transmission date will be July 31,” it was explained.
She however noted that the information will be gathered on an incremental basis.
“So (with) the IGA (Intergovernmental Agreement signed), it is not contemplated that you give all of the information at one time. That’s not how it is intended. Financial institutions are required to submit a limited amount of information…for the reporting year 2014. The information to be provided in 2015 builds on the information that was required in 2014. So this means that the information that was provided in 2014 must be sent in addition to the information being sent for 2015. The full gamut of information that is required under the IGA must be sent and that is what must be transmitted to us, so that we can then transmit it to the IRS (United States, Internal Revenue Service),” she stated.
It was noted that while financial institutions have a deadline of August 15, 2015 to give their information to BRA, the revenue authority has a deadline of September 30, to transmit the information on US account holders in Barbados, for the period ending December 2014. Failure to comply results in a US$50 000 fine.
Some stakeholders have however raised questions about the deadline, given that amendments to the Income Tax Act are yet to be passed in Parliament, to allow for FATCA reporting. However, Minister of Finance and Economic Affairs Christopher Sinckler has given the assurance that the necessary amendments to the Income Tax Act, needed for the FATCA’s implementation, have been approved by Cabinet and will shortly be brought to Parliament. (RSM)
