Extension of Aggregated US Account Reporting Deadline for Swiss FIs
On 20 January the Swiss State Secretariat for International Financial Matters (SIF) published an update (German, French) regarding the aggregated report that is due on 31 January for US account holders that have not provided consent to be reported.
Similar to last year, the update from the SIF notes that the SIF has spoken with the US and agreed that Swiss FIs will not be considered to be significantly noncompliant under Article 11 Section 2 of the Swiss IGA if they are unable to report the required aggregated information by 31 January of this year. Instead, Swiss FIs will have until 31 March 2016 to submit the required aggregated information. This deadline extension for filling the aggregated reporting is a one time exception and does not apply to future years. Furthermore, this exception only applies to the non-consenting US accounts and does not apply to the non-consenting NPFFI accounts (i.e., if applicable, the aggregate information regarding accounts held by non-consenting NPFFIs is still due by 31 January).
A Swiss FI that wishes to make use of the extended deadline is required to inform the FTA. The Swiss Banking Association recommends that such a notification is made to the FTA on or before 31 January 2016.
Deferral of Deadline for Pre-existing Account Due Diligence Certification
Section 8.03(A) of the FFI agreement and regulation §1.1471-4(c)(7) require Reporting Swiss FIs to certify to the IRS that they have complied with the due diligence procedures for preexisting accounts within the applicable timeframe for complying with such procedures. According to the regulation, this certification must be made no later than 60 days following the date that is two years after the effective date of the FFI agreement (e.g., Aug 29, 2016 for FFI agreements effective on July 1, 2014).
On 19 January 2016, the IRS announced (via Notice 2016-08) that this certification will be deferred and will be submitted at the same time that the Reporting Swiss FI is required to submit its first periodic certification of compliance (i.e., by July 1, 2018).
The change to the timing of the certification does not affect the deadlines for a Reporting Swiss FI to complete the due diligence procedures for preexisting accounts. As part of the certification to be made in 2018, Reporting Swiss FIs will be required to certify to the completion of those procedures within the time prescribed in the Swiss IGA.
For additional information regarding this deferral as well as information regarding reporting on NPFFI accounts and the ability of a Swiss FI to rely on an electronically provided Forms W-8 or Form W-9, please see Notice 2016-08.
New Draft Form W-8BEN-E
- A new checkbox for payees to check regarding accounts they hold that are not financial accounts;
- More information regarding how Nonreporting IGA FFIs should use Form W-8BEN-E; and
- A new requirement for a taxpayer to specify which Limitations on Benefits test it meets under its applicable treaty in order to claim a reduced rate of withholding
We will continue to keep you updated on further developments as they occur.