Key Dates and Reminders
- On April 27, 2022, Ireland Revenue published an update to its Tax and Duty manual (TDM) Part 02-01-03 taxation of crypto-asset transactions. The purpose of the TDM is to provide guidance on the tax treatment of various transactions involving cryptocurrencies, virtual currencies, digital money, or any variations of these terms, all of which are referred to as ‘crypto-assets.’ This April 2022 update provides clarity and examples on the treatment of transactions that involve crypto-assets. The tax treatments in the TDM are for tax purposes only and do not reflect the treatment of crypto-assets for regulatory or other purposes.
Check out TDM Part 02-01-03 here.
- On May 2, 2022, the Organisation for Economic Cooperation and Development (OECD) published comments received with respect to the Crypto-Asset Reporting Framework (CARF) and Amendments to the Common Reporting Standard. Further, the OECD announced a public consultation meeting which will be held on May 23, 2022, in a hybrid format, meaning it will take place both in person and virtually. This event will focus on key questions identified in the consultation document and issues raised in the written submissions received as part of the consultation process.
- Check out the published comments on the consultation and the OECD announcement here.
- On May 3, 2022, the Internal Revenue Service (IRS) published Notice 2022-23 which sets forth the proposed amendments to the Qualified Intermediary (QI) agreement in Rev. Proc. 2017-15 that will permit a QI to assume withholding and reporting responsibilities for purposes of Code sections 1446(a) and (f).
- The QI agreement currently in effect and as provided in Notice 2017-15 will expire on December 31, 2022.
- Those wishing to comment must do so either electronically or in writing by May 31, 2022. Comments must include a reference to Notice 2022-23. The preferred way to comment is electronically via the Federal eRulemaking Portal at www.regulations.gov, where the commenter should type IRS-2022-0010 in the search field on that homepage. Commenters are also able to do so by mail to: Internal Revenue Service, CC:PA:LPD:PR (Notice 2022-23), Room 5203, P.O. Box 7604, Ben Franklin Station, Washington, DC 20044.
- You can access the notice and find out more about what is included here.
- On May 4, 2022, the Internal Revenue Service (IRS) published an updated Publication 1187, Specifications for Electronic Filing of Forms 1042-S, Foreign Person’s U.S. Source Income Subject to Withholding For Tax Year 2021.
- The updates as of May 4, 2022, include changes to Part A, General Information, and Part B, Data Communications. You can review the specific updates here.
Check out Pub 1187 here for additional information.
- On May 7, 2022, the Internal Revenue Service (IRS) published DRAFT Instructions for the Requester of Forms W-8BEN, BEN-E, ECI, EXP, and IMY, revised as of June 2022. These instructions address updates that the IRS made to Forms W-8 and their accompanying instructions over the last year. The DRAFT Instructions to Requester include guidance regarding the following:
- Section 1446(f)
- Section 871(m) regulations and qualified securities lenders (QSLs)
- Foreign Taxpayer Identifying Number (FTIN) and where they are not legally required
- Nonqualified Intermediaries (NQIs) that provide alternative withholding statements
- Electronic signatures
- Section 6050Y reporting
Check out the DRAFT Instructions for the Requester of Forms W-8BEN, W-8BEN-E, W-8ECI, W-8EXP, and W-8IMY (Rev. June 2022) here.
- On May 10, 2022, the Internal Revenue Service (IRS) published a new Qualified Intermediary (QI), Withholding Foreign Partnership (WP), and Withholding Foreign Trust (WT) Frequently Asked Question (FAQs) number 20. This FAQ explains how to select the periodic review year for a QI, WP, WT Certification on the QI System. You can access information on how to select the periodic review year here.
Check out the new QI, WP, and WT FAQ 20 here.
- On May 19, 2022, the Internal Revenue Service (IRS) published a DRAFT 2022 Form 8804, Annual Return for Partnership Withholding Tax (Section 1446). The changes can be found here.
Check out the DRAFT 2022 Form 8804 here.
- The Internal Revenue Service (IRS) published a set of Frequently Asked Questions (FAQs) related to the Large Business and International (LB&I) Taxpayer Digital Communication Secure File Sharing – Secure Messaging (TDC SFS-SM) system. This is an IRS approved web-based messaging system that allows for the secure exchange of sensitive information with taxpayers and their Powers of Attorneys (POAs) in the event of an LB&I audit. It was established during the COVID-19 period and is now intended to be a permanent solution to address the needs of the LB&I to exchange digital information with users in a secure manner.
Check out the TDC SFS-SM FAQs here.
FATCA / CRS Key Dates & Reminders – Select Jurisdictions
- The Australian Taxation Office (ATO) registered an Automatic Exchange of Information (AEOI) guide and toolkit for Reporting Financial Institutions. The expected completion is in May 2022. The guide will assist and support Reporting Financial Institutions to self-review their internal control framework to ensure that they meet AEOI compliance obligations which cover the Common Reporting Standard (CRS) and Foreign Account Tax Compliance Act (FATCA) obligations. It will also include practical guidance for self-review of core elements such as AEOI governance, due diligence, reporting systems, and data testing. For this consultation, the ATO is consulting financial institutions and tax practitioners. Those wishing to comment should contact the Consultation Lead. Check out the Consultation and additional details here.
- On May 27, 2022, the Barbados Revenue Authority (the Authority) advised all Reporting Barbados Financial Institutions (RBFIs) that the Automatic Exchange of Information (AEoI) web portal will open on Wednesday, June 1, 2022, for 2021 submissions on Wednesday June 1, 2022. This portal will remain available until Wednesday, August 31, 2022. The Authority warns that submissions made after the deadline will incur a penalty. Failure to submit required reports may result in a fine of $50,000 or imprisonment for a term of 10 years or both. Further, penalties may also include $10,000 for a Reporting Barbados FI that fails to deliver the required report.
- The Authority also announced that in October 2022, the AEoI Portal will begin facilitating the filing of prior year Common Reporting Standard (CRS) and/or Foreign Account Tax Compliance Act (FATCA) reports and corrections to reports previously submitted.
- Check out the Authority’s Announcement here and the additional Guidance Notes here.
- On April 28, 2022, the Bermuda Ministry of Finance (the Ministry) published a notice of extended CRS deadlines and other reminders. Due to technical maintenance on the Bermuda Tax Information Reporting Portal (the Portal), the Ministry extended deadlines for CRS registration and reporting:
- The CRS registration deadline for newly formed Reporting Financial Institutions for the 2021 reporting period is now May 31, 2022 (extended from April 30, 2022).
- The CRS reporting deadline for 2021 CRS filings is now June 15, 2022 (extended from May 31, 2022).
- Check out the full article for details on additional reminders provided in the notice.
British Virgin Islands
- On May 18, 2022, the British Virgin Islands (BVI) Ministry of Finance, International Tax Authority (ITA), published an announcement that users of the BVIFars Portal will not be charged the annual fee for use of the portal on September 1, 2022. Instead, the fees will be implemented later in 2022. The ITA will publish an official notice soon. Check out the BVI ITA announcement here.
- The Cayman Islands Department for International Tax Cooperation (DITC) published an updated version of the DITC Portal User Guide (v9.2).
- China’s State Administration of Taxation announced on its Multilateral Tax Data Service Platform that the deadline for submitting Common Reporting Standard (CRS) data has been extended tentatively to June 30, 2022. The zero declaration, or nil reporting, deadline is not extended and remains May 31, 2022. The Administration recommends completing this declaration as soon as possible.
- Bundeszentralamt für Steuern (BZSt) announced that the production environment for transmitting Foreign Account Tax Compliance Act (FATCA) data for the 2021 reporting period is available now for submissions via ELMA and the BZStOnline Portal (BOP). Further the reporting deadline is July 31, 2022.
- In April, the Mauritius Revenue Authority (MRA) published an updated list of reportable jurisdictions for CRS purposes in respect of 2021 reportable accounts.
- The Inland Revenue Department (IRD) of New Zealand published an updated list of Participating Jurisdictions for CRS effective 1 April 2022. Jurisdictions added to the list are Andorra, Ecuador, Kazakhstan, and Oman.
- On May 18, 2022, in Switzerland, the Federal Council adopted the dispatch on the introduction of the automatic exchange of information (AEoI) with 12 additional partner states that include Ecuador, Georgia, Jamaica, Jordan, Kenya, Moldova, Montenegro, Morocco, New Caledonia, Thailand, Uganda and Ukraine. There are plans for these new agreements to enter into force in 2023 and have their first exchange of data in 2024. Check out the Federal Council announcement here.
- On May 18, 2022, the Taiwan Ministry of Finance announced its plans to extend the reporting period for 2021 financial account information related to the Common Reporting Standard (CRS) from the statutory period of June 1 to June 30, 2022, to the period of June 1 to August 1, 2022. This comes as a response to the impact that COVID-19 has had in the country. The Ministry of Finance will make a public announcement that the deadline for reporting 2021 CRS information is extended to August 1, 2022. Further, the Ministry urges filers to submit their reporting data as early as possible under permissible operating conditions.
- On May 17, 2022, in a keynote speech Lucy Frazer MP, Financial Secretary to the Treasury, stated that the increase in global transparency has seen HM Revenue and Customs (HMRC) bring in more than £500 million to date as a direct result of the Automatic Exchange of Information Agreements (AEoI) such as the Common Reporting Standard (CRS). This comes as more than 100 jurisdictions have signed on to CRS with increased exchanges of taxpayer information. Check out the keynote address here.
Comply Exchange would like to thank the Tax Reporting Group for hosting this year’s Information Reporting and Withholding conference, which included some exciting speakers from across the industry. We are proud to have sponsored this event and look forward to joining again in 2023!
We’re also excited to announce our partnership with Lake Avenue Capital, a leading monetization provider to investment managers looking to prefund tax reclaim receivables and class action claims when liquidity is needed.
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