EY advises on FATCA deadlines

Monday 08 June 2015

Local businesses still have work to do if they are to effectively meet the FATCA reporting deadlines by the end of June, delegates heard at a recent EY update seminar.

More than 70 delegates attended the FATCA update briefing, of which only a small proportion admitted to being fully prepared for the looming deadlines.

EY’s expert speakers, including Richard Clough, a partner at the firm’s London office and partner sponsor of EY’s FATCA reporting solutions, discussed the most important current considerations for efficient and compliant reporting. This included data integrity and security, reporting format and the differences in timelines and requirements for other jurisdictions.

Mr Clough said: “There is still time, though not a lot, and we would advise local businesses that don’t have a final solution in place to act quickly and not leave it until the last minute. There is plenty for Channel Island financial institutions to consider, particularly those working on a cross-jurisdictional basis.

“Of the 98 jurisdictions that have agreed to a Model 1 IGA (inter-governmental agreement) concerning FATCA, a mere 27 have issued full guidance and just 47 have actually signed the IGA. There are important variations in schema requirements, the format in which reporting is done, across these jurisdictions."

The seminar highlighted that both Guernsey and Jersey have issued jurisdictional guidance notes and have successfully tested their reporting mechanisms.

Wendy Martin, EY tax executive director for the Channel Islands and also a speaker at the seminar said understanding the different requirements for each jurisdiction was crucial.

She said: “Businesses will not be able to simply send a report via email or spreadsheet; the ‘schemas’ set out very specific requirements. Risk management processes should also include appropriate sign-off and data security measures. This isn’t something that can be handled last minute.

“Significant time needs to be invested to build a compliant solution that caters for all of these factors and ensures complete and accurate reports. EY recently developed an application called FIRST to do precisely that for local businesses and it works particularly well as a solution for those who haven’t finalised their own.

“We strongly recommend businesses are ready at least two weeks ahead of the 30 June deadline to make sure there are no last minute hiccups."