Grenada Gears Up For FATCA
Grenada’s Inland Revenue Division has completed a series of training exercises for its staff and the island’s financial institutions in preparation for the start of reporting under the US Financial Account Tax Compliance Act.
Reporting by FIs under FATCA is governed by a November 2016 inter-governmental agreement between the US and Grenada. Grenada agreed to collect information from local FIs on their US account holders, and to share this information with the US authorities.
Grenadian FIs are required to report information about US taxpayers with assets of USD50,000 or more, or who hold a greater than 10 percent ownership interest in a Grenadian entity, to the Division. They must also review individual accounts as of June 30, 2014, that exceed USD50,000 (USD250,000 for a cash value insurance contract or annuity contract), and conduct enhanced review procedures for pre-existing individual accounts exceeding USD1m as of June 30, 2014.
Failure by an FI to comply can result in 30 percent withholding tax on US source income, and the possible loss of correspondent banking relationships with the US.
The training by the Division included the use of the electronic platform for reporting by FIs, and a review of obligations for both the Division and reporting FIs.
