After a mad dash by companies to become compliant with the Commercial Entities (Substance Requirements) Act, 2018 (CESRA) by its January 1 registration deadline – which led to a website crash – the Ministry of Finance announced an extension of the deadline to January 31 without penalty.
Companies – claiming they were caught off guard by the deadline – scrambled to complete the registration process last week on Thursday, which led to system failures on the government’s website.
CESRA requires companies operating under the Companies Act, International Business Companies Act, Partnership Act, Partnership Limited Liability Act and the Exempted Limited Partnership Act to register and demonstrate “economic substance” in The Bahamas by proving they have adequate levels of full-time employees and carry out core income generating activities in The Bahamas. It is a critical law based on requirements by the European Union (EU) for tax cooperation.
In a statement released over the weekend, the Ministry of Finance stated that companies and partnerships should now ensure they have submitted their economic substance reports no later than January 31, 2021 to avoid penalty.
“Reports submitted by January 31st will not incur a penalty. Sole proprietorships do not need to submit an economic substance report. Companies and partnerships submit their economic substance report by registering for an entity identification number (EIN) and completing the relevant economic substance form via the economic substance reporting portal: https://ift.tt/3rS6umM. The public is reminded that there is no need to request an EIN for a company or partnership that already has a TIN,” the Ministry of Finance stated.
“Any company or partnership that is registered for VAT can use the same user ID and password that is used for the VAT portal to access the substance reporting portal. Once a company or partnership has its TIN or EIN, it should follow the prompts given in the substance reporting tab to create a filing for 2019 and submit the applicable form(s). If you do not see the substance reporting tab or if 2019 does not appear in the drop down menu for the reporting year, you should make an enquiry from within the portal. You should indicate your date of incorporation and your financial year end.”
The ministry noted that entities operating in The Bahamas that are one hundred percent owned by Bahamian citizens and residents are required to submit an economic substance report, but do not have to satisfy the economic substance requirements of having premises, an adequate number of employees and an adequate level of expenditure.
Such entities were advised to only complete form D on the government’s website.
The post Companies given end-of-month grace period to comply with CESRA appeared first on The Nassau Guardian.
source https://thenassauguardian.com/companies-given-end-of-month-grace-period-to-comply-with-cesra/
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