South Africa shuts down the eFiling-services temporarily

On 8 April 2019, the South African Revenue Service (“SARS”) announced a temporary shutdown of the e@syFile™ – system and the eFiling-service in South Africa. SARS is upgrading its IT systems between Friday 12 April 2019, 17:00 and Tuesday 16 April 2019, 6:00 (local time). Impacted services are eFiling, e@syFile™ and the SARS website (Link).

How to register and how to report for Automatic Exchange of Information in the United Kingdom

On 9 April 2019, Her Majesty’s Revenue & Customs in the United Kingdom (“HMRC”) published an updated version of the guidance on “How to register for Automatic Exchange of Information” (Link).

This guidance refers to:

  • The United States Foreign Account Tax Compliance Act (“FATCA”);
  • Crown Dependencies and Overseas Territories (“CDOTs”); and,
  • The Common Reporting Standard (“CRS”).

In addition, also on 9 April 2019, Her Majesty’s Revenue & Customs in the United Kingdom published an updated version of the guidance on “How to report for Automatic Exchange of Information” (Link).

Financial institutions must use the online system to report to HMRC under Automatic Exchange of Information agreements. The filing date for returns for each year ending 31 December is 31 May of the following year. The list of territories, which are covered by the AEOI process is regularly updated and can be found on HMRC’s website (Link). The changes since the 2018 reporting year are that Antigua and Barbuda, Brunei Darussalam, Costa Rica, Grenada, Macao, Nigeria and Vanuatu have been added to the list. Russia is not a reportable jurisdiction for 2019.

IRS updates FAQs on QI/WP/WT

On 4 and 9 April 2019, the U.S. Internal Revenue Service (“IRS”) updated its Frequently Asked Questions (“FAQs”) on Qualified Intermediaries (“QI”), Withholding Foreign Partnerships (“WP”) and Withholding Foreign Trusts (“WT”) (Link). Question 2 and 5 in the section “Certifications and Periodic Reviews” have been updated to support users in understanding the respective requirements:

Question 2: How should the independence standard for an external reviewer of a QI, WP, or WT be applied for periodic review years prior to 2019?

Answer 2: Section 10.04 of the QI agreement and section 8.04 of the WP and WT agreements provide that an internal or external reviewer must be independent. The preamble to the QI agreement provides that the reviewer must have sufficient independence to conduct the review objectively and cannot review his or her own work or the work of others in the same “firm.” The IRS has received requests for clarification of the independence standard for external reviewers and, in particular, how the IRS construes the term “firm” for purposes of this requirement. Given these requests, for review years prior to 2019, the IRS will permit an external reviewer of a QI, WP, or WT to apply the standards of independence that would otherwise apply to its engagement to conduct the periodic review (such as the standards for an agreed-upon procedures engagement by a certified public accountant). The IRS intends to update this FAQ to provide further guidance on the independence standard for reviews of calendar years 2019 and later.

Question 5: How can a group of QIs or WPs apply to form a CCG?

Answer 5: For certifications due in calendar year 2019, an application to form a CCG should be submitted by the responsible officer, or other authorized user of the proposed Compliance Entity no later than April 1, 2019. The submission must be made using the QI/WP/WT Application and Account Management system.

Upon submission of an application to form a CCG, the IRS will contact the applying Compliance Entity to request any further information necessary to determine if the CCG is acceptable to the IRS. This ongoing discussion will also address such issues as the final composition of the group members and sample design for any statistical sampling to be utilized for the periodic review.

Please note that the CCG should select 2017 or 2018 as the periodic review year. The IRS will not approve CCG applications that select 2016 as the periodic review year for the certification due in 2019.

Sweden issues Newsletter on AEOI

On 29 March 2019, the Swedish Tax Agency released a Newsletter summarizing the latest Automatic Exchange of Information (“AEOI”) events in Sweden.

The newsletter, which is only available in Swedish, once again, includes information regarding Lex Asea dividends, as the value of the distributed shares for PolarCool AB has been recalculated.

Those dividends must be submitted based on the Foreign Account Tax Compliance Act (“FATCA”) and the Common Reporting Standard (“CRS”).

In addition, the Newsletter states, that the final versions of the technical guidances for CRS (Link-Swedish) is now available on the Swedish government website. Noteworthy topics are:

  • Information to be reported for undocumented account is clarified
  • The country code “AX” (Åland) may not be used to indicate residence
  • Clarifications on what information should be provided for Controlling Persons

In addition, the final version for the FATCA technical guidance (Link-Swedish), with the following noteworthy topics, is available:

  • Information regarding FilerCategory and closed accounts, which are both mandatory when reporting to the IRS. The information should, therefore, be submitted to the Swedish Tax Agency.
  • One must use nine capital As (AAAAAAAAA) to populate the US TIN data element. Swedish Tax Agency systems will be changed to accept nine “As” and not nine zeros for the 2018 and 2019 reporting periods.

Please note that the above information have been received through an email subscription. To receive the latest news regarding AEOI in Sweden, feel free to send a request to the following email address: finansiella.konton@skatteverket.se.

Update on Reporting Dates for FATCA and CRS in Italy

On 26 March 2019, the Agenzia delle Entrate (“AdE”) issued Regulation “Prot. n. 69618/2019”, which informs Financial Institutions (“FIs”) that the submission date for 2018 Common Reporting Standard (“CRS”) Reports has been extended to 20 June 2019 (Link).

In addition, Regulation “Prot. n. 69642/2019”, also issued on 26 March 2019, informs Financial Institutions (“FIs”) that the submission date for 2018 Foreign Account Tax Compliance Act (“FATCA”) Reports has been extended to 20 June 2019 (Link).

Brunei Darussalam deposits ratification instruments

As previously reported (Link-Blog), on 12 September 2017, Brunei Darussalam signed the Multilateral Convention on Mutual Administrative Assistance in Tax Matters (“Convention”). Recently, on 28 March 2019, Brunei deposited its ratification instrument for the Convention. The amended convention will enter into force on 1 July 2019 (Link).

The Convention is one of the most important and powerful instruments in the area of international tax cooperation and it provides for all forms of administrative assistance in tax matters, e.g. exchange of information on request, spontaneous exchange, automatic exchange, etc. Moreover, the Convention provides for the extensive safeguards concerning the protection of taxpayers’ rights. As the Convention is the premier instrument for the implementation of the CRS, the Convention should enable Brunei Darussalam to fulfil their commitment to begin the first exchange of the information by 2019.

How to register and how to report for Automatic Exchange of Information in the United Kingdom

On 2 April 2019, Her Majesty’s Revenue & Customs in the United Kingdom (“HMRC”) published an updated version of the guidance on “How to register for Automatic Exchange of Information” (Link).

This guidance refers to:

  • The United States Foreign Account Tax Compliance Act (“FATCA”);
  • Crown Dependencies and Overseas Territories (“CDOTs”); and,
  • The Common Reporting Standard (“CRS”).

In addition, also on 2 April 2019, Her Majesty’s Revenue & Customs in the United Kingdom published an updated version of the guidance on “How to report for Automatic Exchange of Information” (Link).

Financial institutions must use the online system to report to HMRC under Automatic Exchange of Information agreements. The filing date for returns for each year ending 31 December is 31 May of the following year. The list of territories, which are covered by the AEOI process is regularly updated and can be found on HMRC’s website (Link).

Liechtenstein issues guideline for monitoring FATCA and CRS

On 26 March 2019, the Liechtenstein Tax Authority issued “Wegleitung für die FATCA- und AIA-Kontrolle im Jahr 2019“, which is a guideline addressing third party auditors for monitoring Foreign Account Tax Compliance Act (“FATCA”) and Common Reporting Standard (“CRS”) compliance (Link-German).

The controls are carried out by the tax authorities or by independent third parties (Auditors or auditing companies) in accordance with the Tax Authority’s instructions. This guideline specifies the requirements and the procedure for carrying out the controls and explains the principles of the control procedures, the obligations of the independent auditors and the content of the control reports.

In addition, also on 26 March 2019, the Liechtenstein Tax Authority issued a model control report template for preparing inspection reports for trustees, trusts and persons engaged in activities under Art.180a PGR (Link-German).

/* */