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Details

  • Service: Tax, Financial Services
  • Industry: Financial Services
  • Type: Newsletters
  • Date: 6/2/2014

Contact

Gérard Laures
Partner, Tax
Tel. +352 22 51 51 5549

gerard.laures@kpmg.lu

 

Frank Stoltz
Partner, Tax
Tel. +352 22 51 51 5520
frank.stoltz@kpmg.lu

FATCA e-alert Issue 2014-16 

June 2014

Forms W-8, New IGAs

 

Additional Transition Relief with respect to Forms W-8

 

In a recent conference in Washington, DC, IRS officials stated that financial institutions may continue to use existing certification forms through the end of 2014 when documenting non-U.S. entity accounts.

 

Background

 

In Notice 2014-33, issued last month, the IRS announced that it will treat calendar years 2014 and 2015 as a transition period for purposes of enforcement and administration of the due diligence, reporting, and withholding provisions under chapter 4. An entity that has made good faith efforts to comply with the new requirements will be given relief from IRS enforcement during the transition period.

 

Additionally, in consideration of compliance challenges for new entity account opening procedures, resulting from the late release of Forms W-8 and the still pending instructions for Forms W-8BEN-E and W-8IMY, the Notice stated that the FATCA regulations would be amended to allow an entity account opened (or obligation obtained) before 1 January 2015, to be treated as a preexisting account/obligation for purposes of implementing the applicable due diligence, withholding, and reporting requirements. However, the regulations state that revised certification forms must be used within 6 months of the revision date on the form. For Forms W-8BEN-E and W-8ECI, this would be 1 September 2014 and Forms W-8IMY and EXP would be 1 November 2014.

 

Delay

 

According to the IRS official’s announcement, the IRS is preparing to announce its policy decision to permit withholding agents to delay the required use of the revised certification forms until 1 January 2015.

 


 

Liechtenstein signs IGA

 

Representatives of the governments of the United States and Liechtenstein signed an intergovernmental agreement (IGA) to implement U.S. law known as FATCA (Foreign Account Tax Compliance Act).

 

According to a release from the Government of Liechtenstein, the FATCA agreement was signed on 16 May 2014.

 

Text of the IGA is not yet publicly available

 


 

Model 1 IGA reached “in substance” with Azerbaijan

 

The U.S. Treasury Department updated its FATCA webpage to report that Azerbaijan reached an “agreement in substance” for a Model 1 intergovernmental agreement (IGA) with the United States and consented to this status as of 16 May 2014.

 

In early April 2014, the IRS and Treasury Department announced that foreign financial institutions (FFIs) located in a jurisdiction that has reached an “agreement in substance” with the United States, under the FATCA regime, will be treated as having an agreement in effect until the end of 2014.

 

For further information, please do not hesitate to contact us.

 

 

 

 

 

Any tax advice in this communication is not intended or written by KPMG to be used, and cannot be used, by a client or any other person or entity for the purpose of (i) avoiding penalties that may be imposed on any taxpayer or (ii) promoting, marketing, or recommending to another party any matters addressed herein.

The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.

 

 

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