On Tuesday 11 March, UK HMRC announced significant changes to the classification of Financial Institutions (FIs) and the annual FATCA reporting obligations.
HMRC has confirmed that UK FIs will not be required to file ‘nil returns’ for FATCA purposes. Previously all UK FIs were required to file a return even where there were no reportable accounts. This is therefore likely to reduce the initial reporting burden for many groups as they prepare for the first US FATCA reporting deadline of 31 May in the UK.
In another significant development, HMRC intends for Holding Companies and Treasury Centres of Financial Groups to no longer be a separate category of FI under the implementation of US FATCA in the UK. The change should take effect once the new regulations implementing the OECD Common Reporting Standard are laid. Apart from aligning the UK approach with that already taken by other jurisdictions such as Jersey, Guernsey and the Isle of Man, it also reflects the position under the OECD Common Reporting Standard (as well as the UK/CDOT agreements).
The Jersey position on these matters remains unchanged. As previously confirmed, nil returns for Jersey FIs are not required and there is no separate category of FI for Holding Companies and Treasury Centres of Financial Groups.
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