The Internal Revenue Service has activated its new web-based registration system for financial institutions that need to register with the US Government’s tax collecting body, under the Foreign Account Tax Compliance Act.
Financial institutions that must register with the IRS to meet their FATCA obligations may now begin the process of registering by creating an online account and providing the necessary information, the IRS said in a statement.
Participating firms will also be able to provide the required information on their branches of operation and on the other entities which name them as their lead organisation.
FATCA was signed into law in 2010 by President Obama, as part of an effort to crack down on American taxpayers who make use of non-US accounts in order to evade paying US taxes on their overseas income.
The legislation has been criticised for the burden it places on foreign financial institutions to collect large amounts of data on behalf of the US authorities, and its implementation has been repeatedly delayed. The account and due diligence requirments recently were pushed back to next July.
However, the US Government is pushing ahead with the law, and last week the IRS issued a draft version of the form
that will be used for FACTCA reporting.
The IRS said that the registration system which opened yesterday is designed enable 24/7 secure account management.
Using this system, companies will be able to establish online accounts; customise home pages to manage these accounts; designate points of contact to handle registrations; oversee members and/or branch information; and receive automatic notices of status change.
The IRS is advising financial institutions to become familiar with the system, create their online accounts and begin submitting their information as soon as possible.
It says that from January 2014, companies will be expected to finalise their registration information by logging into their accounts, making any necessary changes and submitting the information as final.
As registrations are finalised and approved in 2014, registering financial institutions will receive a notice of registration acceptance, and will be issued with a global intermediary identification number.
The IRS plans to electronically post the first IRS Foreign Financial Institution (FFI) List in June 2014, and to update it monthly.
The deadline given by FATCA to financial institutions for them to finalise registration to ensure inclusion in the June 2014 IRS FFI List is April 25, 2014.
Access to the FATCA registration system and related support information can be found on the FATCA page of IRS.gov.
To read and download a 75-page IRS FATCA Online Registration User Guide from the IRS website, click here.