The Cayman Islands Tax Information Authority ("Cayman TIA") issued the second official version of the Cayman Islands FATCA Guidance Notes (the "Guidance Notes") on 15 December 2014. A copy of the Industry Advisory and the Guidance Notes can be found through the following links:
Defined terms and abbreviations not otherwise described herein have the same meaning given to them in our prior updates.
The Guidance Notes replace the previous version issued on 22 July 2014 and provide additional commentary on a number of areas, including:
- the operation of the Investment Adviser and Investment Manager exemption contained within Annex II of the US and UK IGAs;
- the meaning of the term "controlling person" as may be relevant for obtaining self-certification from a Passive NFFE;
- the treatment of "Limited Capacity Exempt Beneficial Owners" under the UK IGA;
- the classification of dormant and liquidating investment entities;
- clarification of how private trust companies can be classified; and
- a new category of Passive NFFE known as the "Direct Reporting NFFE".
The Guidance Notes are considered to be a dynamic document which has been under review over the past several months by the Working Group which comprises members of the private and public sector in Cayman. As the implementation of FATCA continues and with the pending introduction of the OECD Common Reporting Standards, it is expected that additional or updated versions of the Guidance Notes can be expected in 2015.
In addition to announcing the formal release of the Guidance Notes, the Industry Advisory also mentions that the Ministry of Financial Services, Commerce and Environment is proposing to change from 31 March to 30 April the date by which a Reporting Financial Institution is required by the Cayman Regulations to make certain information notifications to the Cayman TIA.