On 24 October the US Internal Revenue Service (IRS) issued a revised start date for compliance with or implementation of the FATCA. This postponement will somewhat relieve the administrative pressure on European fund managers to have all procedures and systems in place.
As a result of these changes, Participating Foreign Financial Institutions (Participating FFIs) will now be required to implement the new client account procedures and due diligence by 1 January 2014, which is an extension of 6 months from 1 July 2013. Due diligence on pre-existing FFI client accounts is now required to be completed by 30 June 2014, an extension of 6 months from 1 January 2014.
Requirements to implement a FATCA withholding on gross proceeds from the sale of property that produces US source interest or dividends have been delayed until 1 January 2017. In addition, the first reporting deadlines imposed on Participating FFIs for the reporting periods ending 2013 and 2014 have been pushed back to 31 March 2015. The information required to be reported remains unchanged and should include the name, address, taxpayer identification number, account number and account balance for both compliant and non-compliant or recalcitrant accounts.
Industry experts expect that these revised FATCA start dates could be extended again over the coming months.