ITA Guidance Notes on the International Tax Compliance Requirements (US/UK IGAs), Version 2.0 (2015-03-20)

Summary

This is Version 2.0 of the British Virgin Islands International Tax Authority's Guidance Notes explaining how the US and UK Intergovernmental Agreements (IGAs) on international tax compliance (the FATCA-style US IGA and the equivalent UK IGA) apply to BVI Financial Institutions. It does not have the force of law but sets out the ITA's interpretation of registration, due diligence, classification and reporting obligations under the implementing legislation.

• Scope of coverage: Defines and classifies BVI Financial Institutions (custodial institutions, depository institutions, investment entities, specified insurance companies), Non-Reporting and Deemed-Compliant Financial Institutions, trusts, collective investment vehicles, NFFEs and exempt beneficial owners under both the US and UK Agreements.
• Registration: Explains when Reporting BVI Financial Institutions must register (including for US Agreement purposes) and how trustees, sponsored entities and collective investment vehicles are treated for registration.
• Due diligence and classification: Sets out rules for identifying Specified Persons, Reportable Accounts, Controlling Persons of NFFEs, and special treatment of trusts, partnerships, securitisation vehicles, segregated portfolio companies and capital raising subsidiaries.
• Reporting obligations: Describes what information Reporting BVI Financial Institutions must report to the International Tax Authority in respect of Reportable Accounts, including gross payments and movements of assets for trusts and UK Resident Non-Domiciled persons under the Alternative Reporting Regime (ARR).
• Timetables and elections: Provides detailed year-by-year tables of election, self-certification and reporting deadlines to the ITA for both the standard reporting regime and the ARR, covering reporting periods from 2014 through 2017 and onwards.

The Guidance Notes are advisory and interpretive rather than legally binding; readers with doubts about their specific obligations under the underlying legislation are advised to seek independent professional advice.

Key obligations

• Reporting British Virgin Islands Financial Institutions must elect their status with the International Tax Authority by the deadline applicable to the relevant reporting period (e.g. 31 May 2015 for the 2014 period, 15 May 2016 for the 2015 period, 15 May 2017 for the 2016 period)
• UK Resident Non-Domiciled (RND) persons electing into the Alternative Reporting Regime must complete self-certification with the Reporting British Virgin Islands Financial Institution by the specified deadline (e.g. 28 February 2016 for 2014, 28 February 2017 for 2015, 28 February 2018 for 2016)
• Reporting British Virgin Islands Financial Institutions must report Reportable Account information (including gross payments and movements of assets for ARR participants) to the International Tax Authority by the applicable annual reporting date (e.g. 31 May 2016, 31 May 2017, 31 May 2018)
• Trustees of professionally managed trusts that are Reporting British Virgin Islands Financial Institutions must report gross payments and movements of assets between the trust and UK sources/destinations for UK Reportable Accounts
• Financial institutions must apply the classification and due diligence rules in the Guidance Notes to determine Financial Institution status, Reportable Account status and Controlling Person identification for NFFEs

Applies to

BVI Financial Institutions, Reporting British Virgin Islands Financial Institutions, Non-Reporting Financial Institutions, Custodial Institutions, Depository Institutions, Investment Entities, Specified Insurance Companies, Trustees and Trusts, Collective Investment Vehicles, Non-Financial Foreign Entities (NFFEs), Partnerships, Securitisation or structured finance vehicles, Personal Investment Companies, Segregated Portfolio Companies

Deadlines

• 31 May 2015: Deadline for Reporting British Virgin Islands Financial Institution election to the International Tax Authority and for RND election, for the 2014 period covered (30 June 2014 to 5 April 2015)
• 28 February 2016: Deadline for RND self-certification for the 2014 period
• 15 May 2016: Deadline for Reporting British Virgin Islands Financial Institution election and RND election for the 2015 period (6 April 2015 to 5 April 2016)
• 28 February 2017: Deadline for RND self-certification for the 2015 period
• 15 May 2017: Deadline for Reporting British Virgin Islands Financial Institution election and RND election for the 2016 period (6 April 2016 to 5 April 2017)
• 28 February 2018: Deadline for RND self-certification for the 2016 period
• 31 May 2016: ARR reporting date to the International Tax Authority for the 2014 reporting period
• 31 May 2017: ARR reporting date to the International Tax Authority for the 2015 reporting period
• 31 May 2018: ARR reporting date to the International Tax Authority for the 2016 reporting period