OMG - Smacking my head against a wall with HSBC this morning!
Can anyone confirm if I have this correct, or if I have truely and totally lost the plot.
Entity concerned in UK (england & Wales) regsitered, private Limited company, all UK participants, all income from UK sources, probably 98% of income is from trading (service industry - no it is NOT my business!), with a tiny part from investment income.
So under the FATCA definitions I have this down as a NFFE - ie a Non-Financial Foreign Entity. (foreign to the Americans of course because its all their bloody fault we are filling in such rot!!!!!!!)
Then I have two choices - an Active NFFE or a Passive NFFE. I think this one is an 'Active' NFEE, given it has more than 50% from non investment type income - am I correct?
Of course the FACTA info is about as clear as mud, or maybe thats just when you have already spent 1 1/2 hours on clients bank about 3 other complaints and I should grab a brew, a headache tablet or three and start with a fresh mind.
I have criteria showing as:-
Active NFFE
the entity is not a financial institution;
- generally, less than 50% of such entity's gross income for the preceding calendar year is passive income;
and,
less than 50% of the assets held by such entity at any time during the preceding calendar year are assets that produce or are held for the production of passive income (see glossary for the definition of passive income).
Passive NFFE
the entity is not a financial institution or an Active NFFE.
- Generally a Passive NFFE is an entity that primarily earns passive income (e.g. interest, dividends, rents, royalties, etc.).
- An entity primarily earns passive income if more than 50% of its gross income over the last three-year period is passive income.
also found this https://www.gov.uk/hmrc-internal-manuals/international-exchange-of-information/ieim404040
