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UK: Updated AEOI guidance

UK: Updated AEOI guidance

HM Revenue & Customs (HMRC) issued updates to the guidance on the automatic exchange of information (AEOI).

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The update references a “frequently asked question” (FAQ) published by the U.S. Internal Revenue Service (IRS) on 15 October 2019 relating to questions on reporting taxpayer identification numbers (TINs) for 2020 and future reportable periods. The text of the FAQ follows:

Q3. We are a Model 1 FFI and the TIN relief provided under Notice 2017-46 regarding treatment of pre-existing accounts will expire with the reporting of the 2019 data. Do we need to report all required TINs when we provide 2020 and future tax year data?

The transition relief for FFIs to obtain TINs that extended over a period ending on December 31, 2019, will be expiring with reporting for calendar year 2019. The first year a U.S. TIN will be required to be reported concerning a U.S. reportable account is with respect to the 2020 tax year, which is due to be exchanged by a FATCA Partner by September 30, 2021. However, a reporting Model 1 FFI is not required to immediately close or withhold on accounts that do not contain a TIN beginning January 1, 2020. An error notice will generate in scenarios where the TIN is missing or when the TIN is completed with nine As or 0s or in a systemically identifiable pattern (123456789, 987654321, 222222222, etc.) that indicates it is invalid. The error notice will provide 120 days to correct the issue. Consistent with the Intergovernmental Agreement (IGA) and Competent Authority Arrangement (CAA), if applicable, if the TIN is not provided within that 120 day period, the U.S. will evaluate the data received and determine through a consideration of the facts and circumstances if there is significant non-compliance. The IRS will not automatically conclude that the absence of a TIN leads to a determination of significant non-compliance. Instead, the IRS will take account of the facts and circumstances leading to the absence of the TIN, such as the reasons why the TIN could not be obtained, whether the FI has adequate procedures in place to obtain TINs and the efforts made by the FI to obtain them. If the U.S. determines that an FI is in significant non-compliance, the U.S. would notify the exchange partner and will work with the partner, to include further appropriate consideration of the facts and circumstances, over the next 18 months to address the non-compliance. The FI would have at least 18 months from the date of the notification of noncompliance to correct the TIN error before the IRS took any other further action, such as removing the FI’s Global Intermediary Identification Number from the IRS FFI List. An FFI that no longer has a valid GIIN risks being subject to withholding on certain U.S. source payments made to the FI.

Added: 10-15-2019


Read an October 2019 report [PDF 64 KB] prepared by the KPMG member firm in the UK

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