Substance reporting deadline extended to Jan. 31

Substance reporting deadline extended to Jan. 31
(FILE PHOTO)

NASSAU, BAHAMAS — Companies now have until the end of this month to meet substance reporting requirements without incurring a penalty.

The Ministry of Finance said in a statement that all companies or partnerships operating under the Companies Act, International Business Companies Act, Partnership Act, Partnership Limited Liability Act and the Exempted Limited Partnership Act should ensure they have submitted their economic substance reports “no later than” January 31, 2021, to avoid incurring 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://substancereporting.revenue.gov.bs,” said the Ministry of Finance.

It added: “The public is reminded that there is no need to request an EIN for a company or partnership that already has a TIN (tax identification number). Any company or partnership that is registered for VAT (value-added tax) 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).”

It also noted that companies and partnerships operating in The Bahamas that are 100 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.

The requirement is part of legislation passed to meet the European Union’s (EU) demands that Bahamas-based companies have a physical presence and conduct real business. The substance reporting requirements apply to all incorporated entities and legal partnerships in The Bahamas, inclusive of non-profit groups.

The opposition has argued that the deadline extension from the end of December 2020 to the end of January 2021 is not long enough,

Commenting on the deadline extension to the reporting requirements under the CESR Act, 2018, Progressive Liberal Party Chairman Fred Mitchell said: “The extension should be at least 90 days to the 31st of March, 2021. This will give the business community ample time to report and the relevant government agencies adequate time to process the documentation.”