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Comply Connect – July 2023 – Issue 2

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David Marley CEO

New tax forms have become increasingly complex over the years, often requiring individuals and businesses to navigate intricate rules and calculations. In this context, and on the heels of the IRS releasing Draft Forms W-9 and W-8EXP, technology plays a crucial role in simplifying the process around collecting and validating documentation, offering automated, centralized solutions and ensuring accurate compliance with ever-changing tax laws.

COMING UP IN AUGUST 2023:

Barbados: Guidance Note PPG No. 03/2023
The Barbados Revenue Authority released Guidance Note PPG No. 03/2023 advising Reporting Barbados Financial Institutions that the filing deadline for both FATCA and CRS reports for the reporting period of 2022 has been extended to Wednesday, August 2, 2023. The Guidance Note also reminds Reporting Barbados Financial Institutions that failure to submit required reports is an offence and if found guilty of the offence is liable on indictment to a fine of $50,000 or imprisonment for a term of 10 years or both. The Revenue Commissioner of the Authority may also impose a pecuniary penalty of $10,000 on Financial Institutions which fail to deliver the required reports.
St. Kitts and Nevis: FATCA and CRS Reporting Deadline
As a reminder, the St. Kitts and Nevis Inland Revenue Department issued an Industry Advisory in June extending the FATCA and CRS reporting deadline for 2022 reports. FATCA and CRS reports for the 2022 reporting year must be submitted by August 29, 2023.
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JULY 2023 KEY UPDATES:

Filing Information Returns Electronically (FIRE) Information Returns (IR) Application for Transmitter Control Code (TCC)

The IRS is aware that non-U.S. individuals who are acting on behalf of their non-U.S. employer may not be able to complete the Filing Information Returns Electronically (FIRE) Information Returns (IR) Application for Transmitter Control Code (TCC) as the IR Application for TCC requires a Social Security number (SSN) or Individual Tax Identification Number (ITIN) for system access and individual authentication. If you cannot complete your application by August 1, 2023, your Form 1042-S TCC will remain available for filing. The IRS continues to explore other ways for taxpayers to authenticate their identities, including a government-sponsored option.

Non-U.S. entities with an existing Form 1042-S TCC cannot update entity information on their current TCC application. This will not prohibit you from filing; however, you will need to continue accessing the FIRE System using your existing FIRE TCC account information.

If you have other TCCs, such as a TCC for Forms 1099, they will not remain active for filing. To retain those TCCs, you must complete an IR Application for TCC by August 1, 2023. You can log into the IR Application for TCC here.

Draft Form W-9 (Rev. October 2023)

On July 26, the IRS released a draft version of the Form W-9 (Rev. October 2023). There are several changes to the form, notably:

Line 3b is added to allow partnerships, trusts, and estates to indicate that they have foreign partners, owners, or beneficiaries when receiving a request for a Form W-9 if they have selected a federal tax classification of “Partnership” or “Trust/Estate” on line 3b. This change is intended to provide a flow-through entity with information regarding the status of its indirect foreign partners, owners, or beneficiaries, so that it can satisfy any applicable reporting requirements. For example, a partnership that has any indirect foreign partners may be required to complete Schedules K-2 and K-3.

New instructions were added stating that line 3b must be checked if you receive a Form W-8 (or documentary evidence) from any partner, owner, or beneficiary establishing foreign status or if you receive a Form W-9 from any partner, owner, or beneficiary that has checked the box on line 3b.

Text has been added to the instructions noting that if you are a qualified foreign pension fund under Regulations section 1.897(l)-1(d), or a partnership that is wholly owned by qualified foreign pension funds, that is treated as a non-foreign person for purposes of section 1445 withholding, do not use Form W-9. Instead, use Form W-8EXP (or other certification of non-foreign status).

The draft form instructions also includes a note that for more information on optional filing methods for grantor trusts, see the Instructions for Form 1041.

JULY 2023 FATCA AND CRS HEADLINES:

IRS

On July 27, the IRS released the 2023 version of the Form 8966, FATCA Report.

Antigua and Barbuda: FATCA and CRS Reporting Deadline Extended

The Inland Revenue Department of Antigua and Barbuda updated its AEOI portal announcing an extension for both FATCA and CRS reports. The deadline for submission is now September 19, 2023.

Cayman Islands:

The Department for International Tax Cooperation (DITC) of the Cayman Islands published an Updates Bulletin. The Updates Bulletin contains information around 2022 FATCA and CRS reporting deadlines, CRS Compliance Team reminders, and DITC Portal updates.

Germany: CRS Newsletter 03/2023

On July 25, 2023, the Federal Central Tax Office of Germany (BZSt) issued CRS Newsletter 03/2023 which includes the final list of CRS reportable jurisdictions for 2022 reporting.

Ireland: Tax and Duty Manual Part 35-01-01a

On July 5, 2023, the Office of the Revenue Commissioners of Ireland published an updated Tax and Duty Manual Part 35-01-01a.

Ireland: Revenue eBrief No. 150/23

The Office of the Revenue Commissioners of Ireland released eBrief No. 150/23 informing customers that the filing deadline for FATCA, CRS, and DAC2 reports for the 2022 filing period had been deferred from 30 June 2023 to 14 July 2023 due to filing issues in ROS. 

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Featured Articles

New Draft Form W-8EXP

New Draft Form W-8EXP

The IRS released the draft version of Form W-8EXP in June 2023, with a revision date of October 2023. This underscores the need for organizations to proactively plan for changes, including collecting and validating the new form. The updated form includes updates related to the Foreign Investment in Real Property Tax Act (FIRPTA) withholding, as outlined in Section 1445 of the Internal Revenue Code. Specifically, notable changes include the addition

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