Foreign Account Tax Compliance Act (FATCA)
The Foreign Account Tax Compliance Act (FATCA) is US legislation which aims to combat tax evasion by US persons holding accounts and other financial products or assets abroad.
FATCA imposes obligations on certain US taxpayers holding financial assets outside the USA and requires foreign financial institutions (FFIs) to report to the Internal Revenue Service (IRS) certain information about accounts held for US persons.
US persons are to be initially determined based on a number of potential indicators of US connections (referred to as 'indicia' in published material).
It is likely that compliance with FATCA will require the introduction of a number of business and systems processes by the firms affected.
- August 19, 2013 – FATCA registration website is accessible. FFIs to begin registration.
- April 5, 2014 – Deadline for FFI registration.
- June 2, 2014 – IRS will electronically post the first FFI List.
- June 30, 2014 – Withholding agents required to begin withholding payments to payees.
- July 1, 2014 – Withholding agents required to implement new account opening procedures.