Audit, tax, and advisory firm KPMG and data analytics provider Dun & Bradstreet together have launched a new database tool to help global financial institutions comply with the Foreign Account Tax Compliance Act (FATCA).
The U.S. government enacted FATCA in 2010 for the purpose of addressing widespread tax evasion by U.S. taxpayers that hold investments offshore. The U.S. Treasury Department and IRS released final regulations in 2013.
“Classifying entity accounts to comply with FATCA can be time consuming for financial institutions and cumbersome for their customers, but the financial and reputational implications of not complying with these requirements are significant, and the 2016 deadline is looming,” said Jeffrey LeSage, vice chairman of tax at KPMG. “The tool uses Dun & Bradstreet’s vast library of commercial data to provide clients with a cost-effective approach that can help them reduce risk, save time, enhance customer relations, and instill confidence in their ability to meet regulatory requirements.”
The D&B FATCA Classifier delivered through KPMG LINK is designed to simplify the classification of business entities into categories as required by FATCA and is available now. The deadline for foreign financial institutions to complete the remediation exercise for preexisting entity accounts is June 30, 2016. The D&B FATCA Classifier delivered through KPMG LINK provides FATCA tax classifications for a financial institution’s offshore entity customer base via an automated process, which can help reduce the risk of misclassification or the need to ask a customer to self-classify.
Additional features of the tool include regular monitoring, identifying changes that can impact an assigned FATCA status, delivering results through an online portal, and customized reporting. The alliance draws on KPMG’s tax knowledge and FATCA-related project experience, as well as Dun & Bradstreet’s data sources for commercial information and business insight.