FAQs

The regulation applicable to Spanish financial institutions is the Agreement between the Kingdom of Spain and the United States of America for the improvement of international tax compliance and the implementation of the Foreign Account Tax Compliance Act-FATCA, henceforth the Agreement, published in the Official State Gazette of 1 of July 2014, which is directly binding and of obligatory compliance. As a complement to the same, Order HAP/1136/2014, of 30 June, hereinafter, the Order, has been approved, which regulates certain issues related to the obligations to provide information and due diligence established in the agreement between the Kingdom of Spain and the United States of America for the improvement of international tax compliance and the application of American law on foreign account tax compliance and the annual financial accounts informative declaration for specific American individuals is approved, form 290.

Notwithstanding the foregoing, U.S. Treasury regulations may apply in certain cases, such as those referred to in Article 1.2.2 and Article 4 of the Order.

Likewise, article 37 bis has been incorporated recently in the General Regulation of the tax management and inspection actions and procedures and of the development of the common taxation procedure norms, approved by Royal Decree 1065/2007 of 27 July, which regulates financial institutions,' hereinafter FI, obligations to provide information on financial accounts.

Those set out in its article 4 and developed in article 3 of the Order. Therefore, if the financial institution (FI) is a Spanish FI obliged to communicate information and it determines that it does not have any American account subject to information communication after having applied the procedures of due diligence, it will not be obliged to submit form 290, however it is still subject to fulfilling the rest of duties and, particularly, that of being registered with the American Tax Administration.

The answer would be identical in the case of a Spanish FI obliged to communicate information that only had accounts considered to be exempt products according to the provisions of appendix II of the Agreement.

The registration referred to in section d) of article 3 of the Order will be carried out electronically on the website that the United States Internal Revenue Service (IRS) has created for this purpose ( https://sa.www4.irs.gov/fatca-rup/ ).

Registration, like the rest of the obligations of Article 4 of the Agreement, is generally mandatory for all entities that are considered Spanish financial institutions required to report information. If this is not considered, as for example in the case of real estate collective investment institutions, there is no obligation to register.

Registration is also mandatory for small Spanish financial institutions with local clients in Annex II of the Agreement that are required to report information, for sponsoring entities, sponsored investment entities, sponsored controlled foreign companies and, where applicable, sponsored investment vehicles with a small number of investors, referred to in sections C and D of section II of Annex II of the Agreement and under the terms set forth in said annex, as well as for those entities that invoke their status or condition as a foreign financial institution deemed to be in compliance, when required by the applicable regulations issued by the United States Treasury.

With the exceptions indicated, entities identified in Annex II of the Agreement, for example, pension funds, as well as certain collective investment instruments that meet the requirements set out therein, will not be required to register.

Regarding the deadline for registering and obtaining the corresponding Global Intermediary Identification Number (GIIN), while FIs must generally provide said GIIN to avoid withholding on payments made since July 1, 2014, said deadline is extended until January 1, 2015 for FIs from a country with which the US has a bilateral relationship. USA. has signed a FATCA Model 1 Agreement, as is the case of Spain.

 Any pre-existing financial accounts that are identified as reportable U.S. accounts pursuant to the above-mentioned review procedures must be included in Form 290 for the year in which such identification occurred.

As indicated in Order HAP/1136/2014, in the event that the person submitting the declaration acts as a sponsoring entity in accordance with the provisions of section 2 of article 1 thereof, the information referred to in sections 1 to 6 of the annex to said Order must be provided both in respect of the sponsored investment entity and the entity acting as a sponsoring entity.

No. The concept of sponsoring entity is defined in the regulations issued by the United States Treasury and has been incorporated, with the relevant modifications, in sections C and D of section II of annex II of the Agreement, in relation to those entities that, in compliance with the requirements indicated in the aforementioned annex II, assume compliance with the obligations derived from FATCA that correspond to a sponsored investment entity, controlled foreign corporation or a sponsored, closely held investment vehicle (sponsored investment entity, sponsored foreign corporation or sponsored investment vehicle with a small number of investors), which retain liability arising from possible non-compliance.

In any case, in order to submit an informative declaration on behalf of a third party, the necessary representation must be accredited in accordance with the general rules established in the General Tax Law and its implementing regulations.

Regarding the date of birth of the financial account holder (or, where applicable, of the persons exercising control), if it is not completed by leaving said field blank, a warning message will be displayed indicating said circumstance, in order for you to take the appropriate actions to try to obtain said information. The aforementioned notice will be displayed regardless of whether the US TIN is completed or not.

Technically, the label may be optional (assuming a choice between several possible options for one type of information or another), but if it is legally required that said information be included in Form 290, the financial institution must complete the Form with the information it has on that information field, in all cases. That is, if you have it, you cannot choose whether to declare it or not.

Section 2.a) of Article 2 of the Agreement between the Kingdom of Spain and the United States of America for the improvement of international tax compliance and the implementation of the Foreign Account Tax Compliance Act - FATCA (Foreign Account Tax Compliance Act), signed in Madrid on May 14, 2013, establishes the information to be provided for each of the accounts subject to information reporting, with the Annex to Order HAP/1136/2014, of June 30, approving Form 290, detailing the content of the information that Form 290 must contain.

For example, the type of account holder must be provided or it must be indicated whether a particular account has been cancelled, although this is information that corresponds to an optional label in Form 290.

No. The amount of the "Income of funds" field of form 291 ( annual information declaration of the Income Tax for Non-Residents. Accounts of non-residents without a permanent establishment ) does not correspond to the one that must be declared in the "Interests" field of Form 290.

This is because the “Income of funds” field is defined in Form 291 as the total annual amount by sum of entries to the credit of the account or sum of credits, which does not strictly correspond to the concept of interest, as this is the total gross amount of interest paid or owed on the account during the calendar year or other relevant reference period.

When considering whether or not to record this value in Form 290, the following must be taken into account:

• The account number is not limited to the IBAN or ISIN codes, but may be different depending on the category of financial account involved.

• Only in the event that the financial institution does not have any unique identifier, functional equivalent or numbering

  that allows you to identify the declared financial account, you must include the characters "NANUM".

• If “NANUM” was entered because the information is aggregated by client in its databases, the financial institution must provide the identification numbers of the accounts considered individually since this aggregation is not correct in accordance with the applicable regulations.

In short, the use of the value “NANUM” must be considered exceptional, and should only be recorded in those cases in which the financial institution does not have the identification code for the financial account in question.

The regulatory basis for the above is found in the following sections:

Article 2.2.(2) of the Agreement between the Kingdom of Spain and the United States of America for the improvement of international tax compliance and the implementation of the Foreign Account Tax Compliance Act - FATCA (Foreign Account Tax Compliance Act), made in Madrid on May 14, 2013, when determining the information that must be obtained and exchanged, indicates that this consists, among others, of: " b) The account number." the account number (or equivalent functional element in the absence of an account number) ”

Similarly, the Annex to Order HAP/1136/2014, of June 30, approving Form 290, within the content of the annual information declaration of financial accounts of certain US persons, establishes in its section 8 that the messages transmitted by financial institutions to the AEAT must contain a:

 “ Account number . It may consist of an IBAN, ISIN, the reference number of a cash value insurance contract or an annuity contract or any other identifying code used by the financial institution required to report information.”

Therefore, the account number is not limited to IBAN or ISIN codes, but may be different depending on the category of financial account, and only in the event that no unique identifier of the declared financial account is available, it must include the characters "NANUM" (no account number).

No. The NilReport element is optional.

However, according to what is indicated in the Technical Manual for the presentation of Model 290, available in the Electronic Office, if a declaration is presented NilReport para un periodo, no podrá presentarse ninguna declaración con AccountReports para ese periodo hasta que el NilReport sea anulado (FATCA3). Del mismo modo si se han presentado AccountReports para un periodo no podrá presentarse una declaración NilReport para ese periodo hasta que todas las AccountReports sean anuladas (FATCA3). Por último, tampoco se acepta un segundo NilReport para una misma Institución Financiera (ReportingFI) y ejercicio, si ya se aceptó un NilReport.

Access to the manual on the presentation through Web Service

In the case of joint accounts, both for the purposes of determining whether or not the thresholds established in Annex I of the Agreement are exceeded and for the purposes of declaring the account balance in Form 290, the total balance or value of each financial account will be attributed to each account holder. This rule is also applicable for the purposes of aggregating balances. 

However, the existence of a joint account subject to reporting of information does not imply that information relating to the other account holders declared for whom reporting is not required in application of the Agreement and its Development Order must be included in Form 290.