On 12 July 2013, the US Treasury and the IRS announced revised timelines for Foreign Account Tax Compliance Act (FATCA) withholding, new account opening procedures, due diligence transition rules on pre-existing obligations, reporting US accounts, and registration deadlines. A senior Treasury official said that the additional time was intended to allow for more jurisdictions to sign up for intergovernmental agreements (IGAs) prior to the FATCA withholding deadline.
Notice 2013-43 gives withholding agents an additional 6 months to begin withholding on withholdable payments made to foreign financial institutions (FFIs) and non-financial foreign entities (NFFEs). Specifically, a withholding agent will be required to begin FATCA withholding on withholdable payments made after 30 June 2014 on payments that are not considered grandfathered obligations. The notice also provides that the definition of a grandfathered obligation will be revised to include obligations outstanding on 1 July 2014.
The timeline for foreign financial institutions to register on the registration portal has also been extended for 6 months and is expected to open on 19 August 2013.
Source: Thomson Reuters International Taxes Weekly
[LTN 134, 15/7/13]