FATCA e-alert issue 2015-04

FATCA e-alert issue 2015-04

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IRS Launches IDES for FATCA Reporting

In Information Release 2015-01, the IRS announced the International Data Exchange Service (IDES) has opened for enrollment. IDES will be used by non-U.S. financial institutions (FIs) and host country tax authorities (HCTAs) to securely send FATCA-required information on financial accounts held by specified U.S. persons, or held by foreign entities with one of more substantial U.S. owners, and have relevant account information reported to the IRS. Note that Luxembourg FIs shall not use the IDES system, given that Luxembourg has signed an Intergovernmental Agreement with the US. Luxembourg FIs should rather report to the Luxembourg Tax Authorities, who in return will report to the IRS.

 

Background

According to the Information Release, over 145,000 non-U.S. financial institutions have registered through the IRS FATCA Registration System and are subject to reporting requirements under the U.S. Treasury FATCA regulations or under an intergovernmental agreement (IGA), as appropriate. Relevant information must be electronically reported on IRS Form 8966 or via transmission to the IRS using IDES.

 

About IDES

IDES is a web-based application the main function of which is to provide authorized users (FIs and HCTAs) a secure mechanism to transmit FATCA data directly to the IRS. The data must be provided in a standard XML schema format and capture the relevant information as is provided on the FATCA Report (Form 8966). To transmit information in IDES, a FI will need to:

  • Enroll on the IRS FATCA Registration web site and have an IRS-issued global intermediary identification number (GIIN) that appears on the IRS FATCA FFI list. Registration web site:FATCA-Foreign-Financial-Institution-Registration-Tool
  • Obtain a digital certificate. All IDES enrollees (including HCTAs) must obtain a proper digital certificate in order to enroll. A published list of Certificate Authorities is available from the IRS at: Digital-certificates
  • Create an account. Only registered FIs that have a valid GIIN may create an IDES account. The first user at an FI that registers for an IDES account is considered the Administrator. The FI Administrator is able to add, disable and enable end users, update the certificate, update alert preferences, create a metadata file, reset passwords, and download the IRS Public Key.
  • Once the IRS has validated and approved the GIIN and Digital Certificate for the FI, it will receive an enrollment approval via email. This will be the FI’s notification that it can begin to prepare, upload and send data files to the IRS.

 

Important Timing

FATCA reporting begins in 2015 for FATCA-reportable information identified in 2014. The FATCA Report, Form 8966, is due to be electronically submitted to the IRS on or before 31 March 2015. For FIs reporting equivalent information to a HCTA, reporting deadlines vary by country and should be obtained from the FI’s local government. HCTAs will subsequently report FATCA information to the IRS on or before 30 September 2015.

 

For Your Reference

For more information, the IRS’s information page for IDES can be accessed by clicking here: International-Data-Exchange-Service

The IDES User Guide can be accessed by clicking here: p5190idesuserguide.pdf (PDF, 3.17 MB)

To download the standard XML schema format, click here:FATCA-XML-Schemas-and-Business-Rules-for-Form-8966

The IRS’s Questions and Answers regarding the IDES system can be accessed by clicking here: FATCA-IDES-Technical-FAQs

Mexico - FATCA implementation guidance

The second part of Resolución Miscelánea Fiscal para 2015 was published last week in the official journal and includes an "annex" concerning the rules for implementing an agreement between the Mexican Ministry of Finance (Secretaría de Hacienda y Crédito Público) and the U.S. Treasury Department regarding the FATCA regime.

Others provisions under the various anexos address the criteria for binding tax and customs rulings, requirements for economic activities, and standards for controlling gasoline, diesel, natural gas, and LPG sold via establishments open to the general public.

Read a January 2015 report (Spanish) prepared by the KPMG member firm in Mexico: Anexos a la Resolución Miscelánea Fiscal 2015 - Segunda parte.

 

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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