TAJ reports perfect record for FATCA filings
Tax Administration Jamaica (TAJ) reported on Tuesday that local financial institutions required to report under the Foreign Account Tax Compliance Act (FATCA) are now 100 per cent compliant.
FATCA is United States legislation designed to target US taxpayers holding accounts and assets outside that country and are non-compliant with US tax.
Under a government-level agreement, the TAJ secures information from local banks and other financial houses, which it exchanges annually with the US Internal Revenue Service.
While banks have complained about the administrative cost added by the reporting responsibility, they have worked to prepare the reports, with the achievement of full compliance in 2017.
"We had 100 per cent compliance. We have worked with them," boasted TAJ head of corporate communications, Meris Haughton.
Last year, 20 companies missed the deadline in July after an extension given by the tax office. At the time, the deadline for reports was extended to July 22, with only 24 submitted of the 44 that were due.
The report requires disclosure of the names, addresses, account numbers, balances and value as at the end of the relevant calendar year, for US persons. These are for accounts equal to or greater than US$50,000 in value, or US$250,000 for annuity and insurance contracts.
Local financial institutions are required to keep tabs on the account balances, tracking value, receipts, withdrawals and payments.
In Jamaica, the normal deadline for the report on the accounts of US persons of interest to the US authorities is May 31 of each year.
Foreign financial institutions that enter into an agreement to report on account holders may be required to withhold 30 per cent on certain payments to foreign payees if such payees do not comply with FATCA.
For the financial institution itself, the consequence for non-reporting is the docking of accounts held in US banks. They face a 30 per cent withholding tax on all of their US payments and will be deemed non-cooperating.
TAJ is the authority responsible for the coordination of FATCA compliance reporting. It submits the reports to the IRS annually.