Following a review of Liechtenstein by the Forum on Transparency and Exchange of Information for Tax Purposes (“Global Forum”), Liechtenstein amended both the AEoI law and the ordinance to implement the recommendations made by the Global Forum (the Liechtenstein Tax Administration has also prepared a newsletter in German on this subject). The most important changes include:
Entities that so far have made use of the “opt-in” clause need to revisit their entity classification analysis in 2021. Liechtenstein FIs that maintain financial accounts for such entities and know or have reason to believe that (i) the entity has made use of the “opt-in” clause and (ii) would otherwise not meet the criteria of an FI, need to obtain a new self-certification from the entity by 31 December 2021.
Liechtenstein FIs further need to make sure that Liechtenstein entity account holders that have not communicated an AEoI status by 31 December 2021 are classified as Passive NFEs and reported accordingly.
Liechtenstein trustees and corporate services providers need to ensure that all their entities that are Reporting Liechtenstein FIs are registered on the Liechtenstein AEoI portal immediately once they meet the criteria of a Reporting FI, regardless of whether or not they maintain reportable accounts.
US TIN as a mandatory requirement: Following Q.4.3 of the Liechtenstein FATCA FAQs and the IRS FATCA FAQs General (section Reporting, Q.3), the reporting of a US TIN is mandatory from the year 2020 (to be reported in 2021).
Any Liechtenstein FIs that do not hold a US TIN for their clients should try to obtain this identifier from them as soon as possible. In cases where this is not possible and “AAAAAAAAA” is reported according to the Liechtenstein FATCA FAQs, FIs will need to be able to explain to the IRS why the TIN cannot be obtained. Unless the FI can demonstrate that it has adequate procedures in place to obtain TINs and has made reasonable efforts to obtain the TIN, the IRS may consider this as significant non-compliance. At worst, it could lead to the removal of the FI’s GIIN from the IRS FFI list.