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Trinidad And Tobago Given More Time To Enact FATCA Law

by Mike Godfrey, Tax-News.com, Washington

04 October 2016


Trinidad and Tobago has been given until February 2017 to enact legislation to comply with the US Foreign Account Tax Compliance Act (FATCA).

FATCA, enacted by the US Congress in 2010, is intended to ensure that the US obtains information on accounts held abroad at foreign financial institutions (FFIs) by US persons. Failure by an FFI to disclose information on their US clients will result in a requirement to withhold 30 percent tax on payments of US-sourced income.

The original deadline for the enactment of legislation to give force to the intergovernmental agreement (IGA) between the territory and the United States had been September 30, 2016. This was to enable information under FATCA to be transmitted to the US through a centralized agency. However, a lack of support from the opposition, when a three-fifths majority vote was needed, meant that the territory was unable to pass the necessary legislation on time.

Following discussions, the US Treasury has informed Trinidad and Tobago's Government that it will treat the territory as having an IGA "in effect." This treatment recognizes that the territory has signed a FATCA intergovernmental agreement, has resolved to enact the necessary legislation, and has submitted a detailed plan of action to achieve compliance with FATCA.

This means that Trinidad and Tobago will not be subject to any immediate sanctions. However if the territory does not make progress and achieve full compliance by the next reporting deadline, it will be removed from the list of countries that is treated as having an intergovernmental agreement in effect.

The US Ambassador to Trinidad and Tobago, commenting on the implementation of FATCA in the territory, said: "We strongly recommend that Trinidad and Tobago pass legislation no later than February 2017, in order to carry out the commitments undertaken when the FATCA agreement was signed by our two countries, and in line with the implementation plan put forward by the Government of Trinidad and Tobago."

TAGS: compliance | Foreign Account Tax Compliance Act (FATCA) | tax | FATCA | Trinidad and Tobago | legislation | United States | Compliance | Tax

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