On July 12, 2013, the United States Internal Revenue Service (IRS) announced it will postpone by six months—to July 1, 2014—the start of withholding requirements for offshore accounts under the Foreign Account Tax Compliance Act (FATCA).
Notice 2013-43 states that comments indicated certain elements of the phased timeline for the implementation of FATCA could have presented practical problems for both US withholding agents and foreign financial institutions (FFIs). In response, the IRS made revisions to various time frames provided in the regulation.
- The online IRS FATCA registration portal will open Aug. 19, 2013, instead of July 15. 2013
- Online registration is required by April 25, 2014, instead of Oct. 25, 2013, in order to avoid the imposition of withholding taxes when FATCA becomes effective July 1, 2004
- Withholding on interest and dividends from US securities will begin July 1, 2014, instead of Jan. 1, 2014
- For purposes of FATCA, the due diligence rules applicable to new investors will be effective for those investing on or after July 1, 2014, instead of Jan. 1, 2014
It is important FFIs and their customers and investors understand their obligations under FATCA and make a determination regarding whether they intend to comply and what this involves, and, if not, the implications of such a decision.
To ensure you are in compliance, or if you have questions regarding FATCA regulations, please contact your Baker Tilly advisor or send an e-mail to firstname.lastname@example.org.