Tax Administration Jamaica (TAJ) announced on Wednesday July 20 that the new deadline for compliance reports to be submitted in accordance with the Foreign Account Tax Compliance Act (FATCA) will not be extended beyond July 22. The original deadline had been extended to facilitate latecomers.

TAJ said that as of Wednesday, only 24 of 44 reports due had been submitted.

FATCA is United States legislation designed to target non-compliance with US tax laws by US taxpayers who hold accounts and assets outside the US.

Under the agreement, the TAJ obtains reports from financial institutions (FIs) and annually provides the US-IRS (US Internal Revenue Service) with the names, addresses, US Tax Identification Number of specified US people, account numbers, balance and value as at the end of the relevant calendar year.

Tax Administration Jamaica (TAJ) is the authority responsible for the coordination of FATCA compliance reporting.

Banks and others that do not comply with the FATCA requirements face a 30 per cent withholding tax on all of their US payments, and will be deemed non-cooperating.

In a release urging compliance, TAJ outlined that in May, in response to an urgent request from stakeholders within the financial sector, a time extension was granted to allow institutions to make adjustments to their systems to accommodate additional information required by the IRS.

The normal deadline is May 31 of each year, as decreed by the Revenue Administration (Amendment) Act (RAA) 2015.

“TAJ allowed for the submission of FATCA Reports for calendar year 2015 up until July 22, 2016 without penalty,” the agency said, stating that it is now “reminding all Reporting Financial Institutions (RFIs) that the extension to submit their FATCA reports for calendar year 2015 expires on Friday, July 22, 2016, and they are therefore urged to comply.”

Reporting requirements apply to accounts equal to or greater than US$50,000 in value, with a higher value threshold for annuity and insurance contracts equal to or more than US$250,000, where the account holder is a US citizen or has other US affiliation stipulated by the tax authority.

There is a continuing responsibility by RFIs to monitor account balances for reportable accounts. The RFI reports track account balances or value, gross receipts, gross withdrawals and payments from the US taxpayers’ accounts.

TAJ said Wednesday that 20 of the 44 RFIs required to file a FATCA report for calendar year 2015 have not done so, urging submission on Friday to avoid any penalty being applied.

TAJ notes that the FATCA submission process is facilitated through TAJ’s new Revenue Administration Information System (RAIS) that is accessible through its web portal at www.jamaicatax.gov.jm.

“The system employs industry security standards and best practices at the database and communication levels,” TAJ said, adding that RFIs are required to upload their FATCA reports through RAIS.

TAJ said that in turn, it will submit these reports to the US-IRS on behalf of the RFIs and in accordance with the 2015 inter-governmental agreement implementing FATCA.