IRS introduces digital enhancements to FATCA registration system
International Tax Review is part of the Delinian Group, Delinian Limited, 4 Bouverie Street, London, EC4Y 8AX, Registered in England & Wales, Company number 00954730
Copyright © Delinian Limited and its affiliated companies 2024

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

IRS introduces digital enhancements to FATCA registration system

The Internal Revenue Service (IRS) has upgraded the Foreign Account Tax Compliance Act (FATCA) online registration system to improve the way foreign financial institutions (FFIs) report.

FATCA is a registration system for the reporting of foreign financial assets which targets non-compliance by US taxpayers’ with assets in overseas jurisdictions or which hold substantial ownership interest in a foreign enterprise.

The secure, web-based system helps financial institutions with FATCA compliance and is the mechanism through which global intermediary identification numbers (GIINs) are assigned. The latest updates allow participants to input information on a more detailed level than before. The modifications also include an updated jurisdiction list. The upgrade is aimed at facilitating compliance and speeding up the steps of the registration process.

“It should simplify the registration process for investment entities and other FFIs that elected to use the sponsor option, as they can now do a bulk registration,” said Denise Hintzke, FATCA global tax leader at Deloitte in the US.

“It will also make it much easier for institutions that find that they need to make a modification to their existing registration, which wasn't really possible under the old process.”

More than 170,000 FFIs across 200 jurisdictions in the world have registered with the IRS under FATCA.

“There will be a large increase in the number of registered FFIs as the sponsored entities come online,” said Hintzke.

Launched in 2013, the online registration system allows the IRS to identify FFI and other applicable entities with FATCA obligations.

These entities generally report on foreign financial accounts held by US taxpayers under the terms of FATCA or that are in accordance with specific intergovernmental agreements.

John Koskinen, IRS commissioner, described the registration system as “the backbone of FATCA”.

“These upgrades improve the FATCA process, enabling the registration of sponsored entities and making it easier for registrants to use,” he said, “Working with financial institutions and through intergovernmental agreements, our progress against undisclosed foreign accounts continues.”

The new features of the updated system, implemented on November 16, allow users to manually change their information, download registration tables and modify their financial institution type.

Certain sponsored entities are required to have their GIIN for FATCA reporting and withholding purposes by December 31, and the new system updates will enable sponsoring entities to add their sponsored entities and sponsored subsidiary branches.

Hintzke describes the modifications to the system as an expected upgrade to address other issues.

“For example, it is now possible for a FFI to change its registration without having to cancel and re-register,” said Hintzke. 

more across site & bottom lb ros

More from across our site

The full list of finalists has been revealed and the winners will be presented on June 20 at the Metropolitan Club in New York
The ‘big four’ firm has threatened to legally pursue those behind the letter, which has been circulating on social media
The guidelines have been established in the wake of multiple tax scandals and controversies that have rocked the accounting profession
KPMG Netherlands’ former head of assurance also received a permanent bar and $150,000 fine; in other news, asset management firm BlackRock lost a $13.5bn UK tax appeal
The new, fully integrated office will also offer M&A, dispute resolution, IP and corporate tax services
The new guidance concerns a recent 1% excise tax on the repurchases of corporate stock for both US and certain foreign companies
Interpath has hired a managing partner from rival accounting firm BDO to lead the new operation
Survey results of over 28,000 in-house lawyers reveal that American in-house counsel place a higher value on the reputation of external advisers than their peers elsewhere
In an exclusive interview with ITR, Andrew Leigh also endorsed new legislation designed to prevent multinationals using complex corporate structures to reduce taxes
Nick Crama and Parwesh Bissumbhar, senior director and manager respectively at Alvarez & Marsal, outline practical advice for real estate managers to comply with DAC6 regulations
Gift this article