Foreign Tax & Tax Research Division issue Clarification on FATCA Reportable Accounts
Foreign Tax & Tax Research Division has issued a Clarification on frequently asked questions issued by United States of America Internal Revenue Service for Foreign Account Tax Compliance Act - FATCA Reportable Accounts:
1. The Indian Reporting Financial Institutions (RFIs) should ensure that the United States of America. TIN is reported in respect of all United States of America Reportable accounts.
2. However, if the United States of America. TIN is not obtained, the RFI may populate the TIN field with specified codes in scenarios mentioned in the frequently asked questions 6 (reporting) of United States of America, IRS.
3. It is to be noted that in all such cases where TIN has not been obtained, the United States of America. Internal Revenue Service - IRS system will still generate an error notification to indicate that the entry is invalid when one of the above-mentioned codes are used.
4. Further, reporting for calendar year 2022 (due by September 30, 2023) is considered to be a transition year, and to be eligible for relief, Indian Reporting Financial Institutions - RFIs must either use the TIN codes specified in the clarification issued in reference to the above subject on 31 January 2022 or the updated TIN Preexisting entity account held by a passive NFFE with one or more codes mentioned in the frequently asked questions 6 above.
5. For subsequent years, Indian Reporting Financial Institutions will have to follow the updated TIN codes referred in FAQ6.
Circular No: F. No. 500/107/2015-FT&TR-III