The Government of the Virgin Islands remains committed to ensuring that financial institutions in the Territory adhere to established international standards.
As such, financial institutions are reminded of the reporting obligations under the Inter-governmental Agreements that the Government signed with the Government of the United Kingdom of Great Britain and Northern Ireland (UK CDOT or UK FATCA or UK IGA); as well as the Government of the United States (US FATCA or US IGA).
The purpose of both agreements is to automatically exchange information with the relevant partner jurisdiction, with an aim to improve international tax compliance.
As a result of these agreements financial institutions in the Territory have an obligation to collect and maintain information in accordance with Annex I of these Agreements, and report all relevant accounts to the Government via the International Tax Authority (ITA).
The ITA electronically accepts reports, through the BVI Financial Account Reporting System (BVIFARS). Information on BVIFARS, along with copies of the agreements, relevant legislation, guidance notes and self-certification forms can be accessed via the Government website at: www.bvi.gov.vg/FATCA.
The first reporting under the US FATCA Agreement occurred last year and, as a result of the cooperation of the financial institutions, the Government was able to fulfill its obligations under this Inter-governmental Agreement.
Financial institutions that were unable to complete customer due diligence for 2014 accounts, are reminded that outstanding 2014 reportable accounts can still be submitted in 2016, without incurring any penalties.
The financial institutions are also reminded that the annual reporting deadline for US FATCA is May 31 and reports can be submitted up to that date. Financial institutions are required to enroll on BVIFARS, in order to be able to access the system to submit their reportable accounts.
The BVIFARS portal is open year round to accept enrolment applications; however, where a financial institution has information to be reported in a given year, the deadline for enrolment for that year is April.
All financial institutions with reportable accounts under the US FATCA agreement, and have not already enrolled can do so until April 30, 2016.
The Government of the United Kingdom also has an equivalent regime similar to the US FATCA, to allow for automatic exchange of information between the United Kingdom and its Overseas Territories and its Crown Dependencies. Under the UK CDOT Agreement, the first reporting is required this year. This reporting period will cover July 1, 2014 to December 31, 2015.
Financial institutions are advised that Her Majesty’s Revenue and Customs (HMRC) has confirmed that they will be accepting UK reportable accounts for 2014 and 2015 using the format for the US XML Schema. A copy of the format of US XML Schema can be found on the following website: https://www.irs.gov/Businesses/Corporations/FATCA-XML-Schemas-and-Business-Rules-for-Form-8966.
Financial institutions that have UK CDOT reporting obligations, and have not already enrolled on BVIFARS, are advised to refrain from enrolling on BVIFARS at this time, until the system is properly configured to accept UK CDOT filings.
A further press release will be issued to advise when BVIFARS is ready to accept enrolment applications and reporting information for UK CDOT purposes.
For more information on all of the UK and US FATCA reporting standards and obligations, visit www.bvi.gov.vg/FATCA.