The Irish tax authorities (the Revenue Commissioners) circulated draft guidance notes on the implementation of FATCA in Ireland and a draft of the Financial Accounts Reporting Regulations 2013 (the Regulations) in early May. These draft publications follow on from the FATCA enabling legislation contained in the Finance Act 2013 (see our Spring 2013 alert).
The draft Regulations provide that any person carrying on a business in Ireland as a custodial or depository institution, an investment entity or a specified insurance company shall be regarded, subject to certain exceptions, a reporting financial institution (RFI) for FATCA purposes. A RFI shall be required to register with the Internal Revenue Service, with the date of registration provisionally being set at 25 October 2013 (IRS) at the latest. The draft Regulations require RFIs to apply the due diligence rules and procedures detailed in Annex I to the Ireland – US Intergovernmental Agreement (IGA) to identify the account holders of those accounts reportable under FATCA. The draft Regulations further require RFIs to make and deliver a return of all reportable accounts maintained by a certain date (provisionally set as 30 June) in the tax year following the tax year to which the return relates. Details of the information to be reported are set out in the draft Regulations. Finally the draft Regulations provide, while a RFI can appoint a third party as its agent to carry out its obligations under the Regulations and IGA the financial institution itself remains responsible for any failure by its agent in carrying out those obligations
The draft guidance notes broadly follow those published previously by HM Revenue and Customs in the UK. In the context of funds the guidance considers among other matters (i) when a fund is exempt from FATCA reporting requirements under Annex II of the IGA or separately under the US Treasury Regulations, (ii) which ‘investment entity’ may have reporting obligations where a fund does not fall within the category of a non-reporting Irish Financial Institution and (ii) the documenting of new accounts on a merger of two funds.
The Revenue Commissioners indicated on publishing the draft Regulations and guidance that they would be accepting observations and comments on them up to the end of May. A number of trade associations including the Irish Funds Industry Association (the IFIA) and the Irish Debt Securities Association (the IDSA) have taken the opportunity to make submissions to the Revenue Commissioners. Revised draft guidance notes are expected to be issued by the Revenue Commissioners in July.