On February 21, 2022, the British Virgin Islands International Tax Authority (BVI ITA) announced the BVI Financial Account Reporting System (BVIFARS) will be offline starting Monday, February 21, 2022 until further notice. The BVI ITA expects to provide an update regarding the portal during the week of February 21.
The BVI ITA also provided a reminder regarding the mandatory inclusion of tax identification numbers (TINs) in FATCA reporting.
FATCA TIN Reporting
As part of a Financial Institution’s (FI’s) FATCA obligations, it must report the U.S. TIN for each specified U.S. person who is an account holder or a controlling person. The BVI ITA reminded FIs to include TINs or one of the IRS acceptable codes. Additionally, the FI should be aware it will receive a record-level error notification when using one of the IRS substitute codes and must correct the missing TIN within 120 days.
If the missing TIN is not corrected within 120 days, the BVI ITA advised that the “IRS will not automatically find significant non-compliance, but rather, if the IRS makes contact with a FI, a FI should have in its possession documented attempts made to obtain any missing TIN from its filing(s).”
BVIFARS TIN Update
The BVI ITA also noted the BVIFARs portal has been updated to allow for “an ‘ISSUED BY’ option, where the account holder that is not assigned a TIN or is not a holder of a TIN, but the account has a substantial US owner.”
For completing filings in this circumstance, please see the following steps and details below.
“The FI must include the TIN element for both Account Holder and Substantial Owner. If both are US individuals/entities, the FI should include the US TIN for both. If only one is a US individual/entity, then the FI will not receive an error message as long as the FI include a validly formatted US TIN in the TIN element for the US individual/entity and the foreign TIN (with the “TIN Issued by” element populated with the issuing country code) for the foreign individual/entity. If there is no foreign TIN available for the foreign individual/entity, the FI may include its country code in the “TIN Issued by” element and the characters “NA” (to indicate “Not Available”) in the TIN element.
If the FI omit the TIN element entirely for either the Account Holder or Substantial Owner, or insert blank spaces in the TIN element, the FI will receive a “TIN Not Populated” error, regardless of whether the other TIN field is populated with a US TIN.”
IRS No TIN List
Although not discussed by the BVI ITA, it is important to be aware of the IRS List of Jurisdictions That Do Not Issue Foreign TINs. Currently, the below jurisdiction are on the IRS No Tin list:
FIs are not required to obtain a foreign TIN for an account held by a tax resident of a jurisdiction that appears on this list. Any changes to the No TIN List will be posted on the IRS site. Changes will include additional jurisdictions which request to be added to the list (even if the jurisdictions issue foreign TINs to individuals or entities resident in such jurisdictions). The IRS will also update the list if a jurisdiction included on the list begins to issue foreign TINs to its residents.
For assistance, please contact me via my contact page or at elizabeth@elizabethmcmorrowlaw.com.