Recently there have been a number of updates to the FATCA and CRS guidance issued by the IRS, OECD and Irish Revenue.  Many of these updates will affect the upcoming returns due at the end of June, while others apply to overall compliance.  FATCA reporting continues to evolve in this third year of reporting and 2017 marks the first year of CRS returns being due which comes with its own unique challenges.

Compliance with all aspects of FATCA and CRS requires a robust operational process as well as diligent monitoring of updates to and interpretations of available guidance.  Audit programmes are being discussed and rolled out by Revenue authorities worldwide, therefore Financial Institutions would be wise to perform compliance health checks and implement remediation plans as necessary.

FATCA

• Irish Revenue have updated Revenue Online System (ROS) which requires Financial Institutions to register their reporting obligations, both for FATCA and CRS, in order to submit returns. If your entity is submitting returns directly to Irish Revenue you will need to log into ROS to complete this registration prior to submitting your return or if you have identified an agent your agent will complete this registration  for you, via the Agent Link Form process.
• Irish Revenue has altered the process for any entity which requires registration for solely FATCA and/or CRS purposes, i.e. they have no tax liability in Ireland, the entity should register itself as a ‘Reporting Entity’ by completing the “Reporting Entity Registration Form”, which can be found on Irish Revenue’s AEOI page. If you have an agent completing this process your agent, will complete this registration, via the Agent Link Form process. Upon registering as a ‘Reporting Entity’ a Reporting Entity Registration Number will be provided.
• The IRS has confirmed that beginning January 2018 the IRS will not accept FATCA returns where the account holder’s TIN contains nine zeros. Beginning January 2018 the IRS will update its record validation to issue error notifications to Financial Institutions where a TIN is entered of nine zeros for an account holder. See IDES FAQs F15 for complete details.  While 2016 reporting, due 30 June 2017, is not impacted from this update Financial Institutions should ensure that they are prepared for 2017 reporting, due 30 June 2018, where they will be required to include the TINs for all account holders, pre-existing and new, which are reportable under FATCA.
• Three new questions have been added to General Compliance Section on the FAQs for FATCA on the 6th of April 2017 with regards to Beneficial Owner’s requirements. More information can be found on the IRS website from Q20 to Q22.

CRS

• Financial Institutions are required to complete the registration of their reporting obligations in ROS, as noted in points one and two of the FATCA section above.
• CRS returns can be completed for all jurisdictions in one single CRS return.
• Irish Revenue recently updated their CRS FAQs to amend the requirements of the ‘Customer Information Notices’. These new specifications are listed in questions #2 and 3, which indicate Financial Institutions are required to provide the ‘Customer Information Notices’ to all individual account holders, including Controlling Persons, and specifies what information should be contained in a ‘Customer Information Notice’.  Financial institutions will therefore be required to perhaps update self-certifications and information contained on their website with respect to CRS.
• Several questions have been included or updated in the OECD CRS FAQs. These questions refer to the below sections and are highlighted in yellow in the most recent document. The most up to date OECD CRS FAQs can be found on the OECD portal.
  • Section I: General Reporting Requirements
  • Sections II-VII: Due Diligence Requirements
  • Section VIII: Definitions

The most up to date OECD CRS FAQs can be found on the OECD portal.

• The Standard of Automatic Exchange of Financial Information in Tax Matters was re-issued by the OECD on the 6th of April. This new edition expands the last part on the CRS XML Schema User Guide. It contains additional technical guidance on the handling of corrections and cancellations within the CRS XML Schema, as well as a revised and expanded set of correction examples.

Please continue to be diligent about updates and changes to guidance as further FAQ updates are expected from Revenue.  If you would like to discuss these updates or how EY can assist you in fulfilling your FATCA and CRS requirements please reach out to me or your EY contact at any time.