The Bahamas Investor

...shed with the following mandate: to prepare an implementation strategy for FATCA, inclusive of the draft FATCA Agreement; to prepare and issue a Request for Proposals (RFP) for the development and implementation of a FATCA reporting system; to oversee all aspects of the implementation of The Bahamas’ FATCA compliance and to oversee the necessary legislative reforms.” Minister Pinder said that FATCA was signed into US law in 2010 through the US Hir......

...or any interest in such securities, partnership interests, or commodities. FATCA requirements FATCA requires a withholding agent and participating FFIs to deduct and withhold 30 per cent on any withholdable or “passthru” payment made to FFIs that do not comply with FATCA and NFFEs who do not report substantial US owners or certify no substantial US ownership. A withholdable payment is: • Any payment of interest (including any portfolio interest an......

...ental agreement (IGA) to allow their financial institutions to comply with FATCA. The intergovernmental approach to implementing FATCA reduces the cost and simplifies the compliance burden for financial institutions. The intergovernmental approach has two models, Model 1 and Model 2. Pursuant to Model 1, partner jurisdictions agree to report to the IRS specified information about the US accounts maintained by all relevant Foreign Financial Institu......

...was not what we would support. This is outside the scope of the intent of FATCA. FATCA is an information gathering exercise. It is not a trust registry and The Bahamas would not support such a position,” Pinder recalled. “We proposed that there be a sponsored exemption for trusts in the FATCA Intergovernment Agreement in the Annex . They went back to Washington and the next day on the symposium they announced that they had an agreement from Washi......

...on the United States legislation, the Foreign Account Tax Compliance Act (FATCA). The Internal Revenue Services describes the FATCA as “an important development in US efforts to improve tax compliance involving foreign financial assets and offshore accounts.” Generally, FATCA will require foreign financial institutions to report directly to the IRS information about financial accounts held by US taxpayers, or held by foreign entities in which US......

...sectoral issues such as “How and When to Communicate with Customers About FATCA”; “Which Company Executives or Stakeholders Should be Involved in the FATCA Programme”; and “The Model Intergovernmental Agreements (IGAs).” This will be followed by case studies on practical implications, covering specific sectors, such as wealth management, insurance, funds and securities, and retail banking. The event will conclude with an overview of the legal imp......

...crucial clarity for financial institutions as they prepare to comply with FATCA starting on July 1.” Congress enacted FATCA in 2010 to target non-compliance by US taxpayers using foreign accounts, and the provision has since become the global standard for promoting tax transparency. It requires US financial institutions to withhold a portion of certain payments made to FFIs that do not agree to identify and report information on US account holder......

...ties can result in a 30 per cent withholding tax on all US source income. “FATCA is not going away,” cautioned Lawrence Lewis, Deloitte ’s lead partner for the FATCA initiative for The Bahamas, and one of the seminar’s speakers. “Most institutions will need to comply because they have some exposure, however minor. It’s simply too risky not to.” FATCA will impose several significant tax reporting, due diligence and tax payment obligations on financ......

...world” and said it was making headlines around the globe. “The reality is FATCA is here and FATCA is not going away,” she told attendees. Minister for Financial Services Ryan Pinder said FATCA was an indication of the growing importance of compliance. “We as an industry must be prepared to accept that what we are subject to under FATCA will only be the start of a new normal,” he said. “We, as a long-standing jurisdiction that has developed a sign......

...compliance. While the 388-page document leaves many unanswered questions, FATCA’s central purpose remains simple: to identify US taxpayers who hold financial assets in non-US financial institutions and other offshore accounts, so that they cannot avoid US tax obligations. Even with the uncertainty, financial institutions should be encouraged that the picture surrounding FATCA is brightening. Moreover, the US Treasury Department conveyed a clear i......

...thel, a former legal advisor to the Ministry of Finance, participated in a FATCA panel discussion at the recent Bahamas Association of Compliance Officers’ Money Laundering Reporting Officers (MLRO) Day. Her fellow panelist Geovannie Rodgers, manager in Assurance and Advisory Services at Deloitte & Touche, advised institutions that the three stages of becoming FATCA compliant are: assessing your organization; performing a “gap analysis” to discove......

...dialogue with the financial community,” she said. “We think we have gotten FATCA to a place where it can be implemented without being overly burdensome. Wherever possible, we have tried to build on existing practices.” Under FATCA, foreign financial institutions (FFIs) are forced to disclose information on their US accounts to the US Treasury. Governments can follow two reporting models when adhering to FATCA. The first Inter-Government Agreement......

...anuary 2013, according to accounting firm Deloitte ‘s lead partner for the FATCA initiative, Lawrence Lewis. “Financial institutions [in The Bahamas] have been pressing forward, identifying what they need to do. Vis-a-vis the world stage, we have not been that far behind,” he says. FATCA requires all Foreign Financial Institutions (FFIs) to enter into an agreement with the US Treasury to disclose information on certain US clients. The financial se......

...nt being held at the British Colonial Hilton in Nassau. The Complying With FATCA conference is organized by the Ministry in collaboration with the Bahamas Assocation of Compliance Officers (BACO) and has attracted financial professionals from across the Caribbean. Opening the event yesterday, Minister for Financial Services Ryan Pinder said the conference was “a groundbreaking opportunity” and “the first of its kind in the region.” FATCA requires......

...hat we do.” The government is currrently drafting legislation to implement FATCA and is drawing up industry guidelines. It hopes to release the former by the end of the year and the latter in February 2014. An electronic reporting system is expected to be in place by summer 2014. “We feel that the future is bright. We see FATCA as something that has some advantages for us,” said Virgill-Rolle. “Tax compliant structures are the way of the future [a......