FATCA and Common Reporting Standard
The United States of America (USA) enacted the Foreign Account Tax Compliance Act (FATCA) in 2010 for the reporting of assets held by US taxpayers in offshore accounts and through non-US entities. In line with this, the US entered into bilateral agreements with governments of several countries for the exchange of information.
Following FATCA, Common Reporting Standard (CRS) was enacted by various countries including the United Arab Emirates (UAE). Pursuant to the implementation of CRS, financial institutions are required to comply with reporting requirements on an annual basis.
Nexdigm provides an extensive range of services with respect to FATCA/CRS compliances which includes analyzing and evaluating whether an entity is a financial institution and handling the due compliances under the FATCA and CRS regulations.
- Entity classification
Classification of the entity under the regulation and evaluating whether it is subject to any compliance requirement under FATCA/CRS.
- On-boarding the account holders
Drafting self-certification for the account holders to correctly provide their information for the purposes of reporting.
Provide support with respect to registration on IRS and local portals.
- Principal Point of Contact [PPOC]
Provide assistance to financial institutions by acting as a PPOC for the purpose of coordinating with FATCA/CRS authorities.
- Due Diligence procedures
Setting up Due Diligence procedures for effective implementation of the regulations.
- Reporting assistance
Providing support in undertaking the reporting compliance with the regulatory authorities.
- Conducted analyses to determine the classification of the entity and identified relevant implications arising from them. We suggested a way forward based on applicable FATCA/CRS regulations for several UAE entities (including entities in the DIFC and ADGM region)
- Assistance in filing the FATCA/CRS returns for entities of Cayman Islands
- Complete Due Diligence and assistance in undertaking reporting under FATCA/CRS regulations for Indian entities