December 16, 2019

Cayman Islands – Draft FATCA guidance notes released for comments

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Draft FThe Cayman Islands on 12 May 2014 released a first draft of guidance notes concerning the compliance requirements of the intergovernmental agreement () between the Cayman Islands and the United States and between the Cayman Islands and the United Kingdom.

The 221-page draft guidance notes [PDF 2.24 MB] were released for industry comments and feedback at: https://www.kpmg.com/US/en/IssuesAndInsights/ArticlesPublications/taxnewsflash/Documents/guidance-notes-may13-2014.pdf

The guidance notes are intended to provide practical assistance to industry in interpreting the FATCA agreements with the United States and the , and will be a key component of Cayman’s automatic exchange of information regime for implementing the agreements.

The FATCA Working Group also established an IT subgroup to focus on technical modalities for the automatic exchange of information for tax purposes, and will be intended to follow published IRS rules.

Read a May 2014 report [PDF 176 KB] prepared by the KPMG member firm in the Cayman Islands: Cayman Islands – Draft FATCA Guidance Notes released for industry feedback below or go to: https://www.kpmg.com/Global/en/IssuesAndInsights/ArticlesPublications/taxnewsflash/Documents/cayman-may13-2014.pdf

Cayman Islands – Draft FATCA

Guidance Notes released for industry feedback 13 May 2014

David Conen Partner, US Tax +1 345 914 4356 [email protected]

Kendell Pierre Senior Manager, Advisory +1 345 914 4356 kendellpi[email protected]

Draft F 1The Cayman Islands Ministry of Finance released the first draft of the FATCA guidance notes on the compliance requirements of the intergovernmental agreement (IGA) between the Cayman Islands and the US and between the Cayman Islands and the UK.

The Ministry is seeking feedback on these guidance notes from the UK’s HM Revenue & Customs, and the US Department of the Treasury.

Industry is invited to provide comments and feedback until 6 June 2014.

Link to the draft guidance notes

These guidance notes are intended to provide practical assistance to industry in dealing with the application of the IGA with the US and the UK

and will be a key component of Cayman’s automatic exchange of information regime for implementing the agreements.

The Cayman Islands FATCA Working Group also established an ITsubgroup to focus on technical modalities for the automatic exchange of

information for tax purposes. These modalities will follow the published IRS schema and, when complete, the OECD schema for the common reporting standard (CRS).

Draft F 2Notable items in the guidance notes include:

.           Section 1.5. notes that in several sections of the guidance notes Cayman Islands FI’s will be able to apply definitions from the US regulations in place of the IGA definitions. Where this is noted in the guidance notes, Financial Institutions are not required to seek approval from Cayman Competent Authority.

.          Section 2.11. addresses some common entity classification concerns for captive insurance companies and insurance managers.

.          Sections 3.1. and 3.3. note that Certified Deemed Compliant FIs generally will not need to register with the IRS to obtain a GIIN.

Roman Ipfling

Manager, US Tax +1 345 914 4380 [email protected]

kpmg.ky

Certified Deemed Compliant FIs include also

.          Section 17.3. Reporting Cayman Islands Financial Institutions with no Reportable Accounts are required under the Regulations to make a report to that effect to the Cayman Islands Tax Information

For more information contact any member of our FATCA team.

David Conen

Partner, US Tax Practice KPMG in the Cayman Islands

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