Foreign Account Tax Compliance Act (FATCA)

Your latest FATCA information
OECD Publishes Common Reporting Standard
IRS amendments clarify and correct FATCA regulations: Do any of the changes affect your compliance plan?
Draft US Form W-8IMY Released
FATCA Registration
IRS opens FATCA online registration system to provide a beneficial user testing period
HM Treasure and HMRC
HM Treasury and HMRC lay UK regulations before the UK House of Commons
Draft US Form 8966, W-9 Instructions Released
Treasury releases second model agreement for implementing FATCA
US government announces six-month extension to FATCA effective dates
Draft FATCA-related IRS forms: A snapshot of those released so far
HMRC issues Draft Guidance Notes - Implementation of International Tax Compliance (United States of America) Regulations 2013
Global IRW Newsbrief: European Commission seeks to expand automatic information exchange between EU Member States
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How will your firm be affected by FATCA?

FATCA, which was enacted as part of the Hiring Incentives to Restore Employment (HIRE) Act of 2010, requires financial institutions to use enhanced due diligence procedures to identify US persons who have invested in either non-US financial accounts or non-US entities. The intent behind FATCA is to keep US persons from hiding income and assets overseas.

A foreign financial institution (FFI) could face significant consequences if it fails to enter into an agreement with the Internal Revenue Service (IRS), which is merely the first step; the ability to align all the key stakeholders, including operations, technology, risk, legal, and tax, will be paramount to successfully comply with FATCA. The institution would be subject to a 30% withholding tax on any “withholdable payment” made to its proprietary account for failing to comply with FATCA.

In addition, accountholders who don’t provide the FFI with FATCA-required documentation would be deemed recalcitrant. The FFI would then be obligated to deduct a 30% withholding tax on any withholdable payment credited to their accounts.


Preparing for FATCA

Multinational financial institutions will need to make significant process and technology changes to comply with FATCA. While most FATCA provisions don’t take effect until the middle of 2013, many financial institutions have already begun to prepare. Financial institutions should consider steps such as:

  • Performing a current state assessment of your systems and operations.
  • Conducting gap analyses against your identified requirements.
  • Developing action plans to implement changes required for FATCA compliance.
  • Evaluating your legal entities to determine if they are FFIs or otherwise covered by FATCA.

How PwC can help you

To help you prepare, PwC has formed a network of FATCA specialists in key markets throughout the world. These professionals are part of our Global Information Reporting (GIR) practice, which brings together specialists who know the intricacies of tax law as well as local jurisdictions, rules and regulations.

Financial services companies already have worked with us on current state and gap assessments and taken part in our FATCA training programs. To plan your transition, contact PwC’s FATCA team:

  • Adrian Tait at +1 (876) 932 8429
  • Paul Williams at +1 (876) 932 8328
  • Eric Crawford at +1 (876) 932 8323
  • Brian Denning at +1 (876) 932 8423
  • Dominick Dell'Imperio +1 (646) 471 2386
  • Jon Lakritz +1 (646) 417 2259