Double click on the red flag. Top left quadrant will show the flag and the reason why it was raised. Red flags are mandatory to remediate as it might change the reporting status.
Red flags might be raised for indicia and/or missing important information.
Note that other changes in circumstances may also cause the system to clear flags automatically.
Example: Using a FATCA Rulebase a Red Flag was raised for indicia.
The reportable jurisdiction is Netherlands.
The Indicia shows that the Country Code of the Address is US.
To remediate the Red Flag there are 3 options, depending on the evidence of the due diligence:
1) Edit the Country Code of the Address if found this was an incorrect Country Code. This will discard the indicia and will change the Reporting Status to Green G: We have all the data points necessary, and this account doesn’t need to be reported.
To edit click on the Edit button.
2) If the Country Code of the Address is correct but you have proof that the account holder is not a tax resident in the US, you can check both boxes in the lower left quadrant and add a comment to remedy the red flag. The flag will change the Reporting Status to Green G: We have all the data points necessary, and this account doesn’t need to be reported.
(Optionally proof of due diligence can be uploaded in the right upper quadrant.)
3) If the performed due diligence confirms that the client is indeed a US tax resident, then you must edit the record to change the Reportable Jurisdiction to US and add the US TIN. This will change the Reporting Status to Green ✓: We have all the data points necessary, and this account needs to be reported.
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** Tax Authority Portal users: Flags might not be available for you. You will only be able to edit the record and/or account balance and check the hierarchy.
Interested in the Remediation Module? Please contact sales@transworldcompliance.com