Fact Sheet - Foreign Account Tax Compliance Act (FATCA)
- Structured, linked and automated
Enacted under the US Hiring Incentives to Restore Employment (HIRE) Act in 2010, the FATCA provisions represent a significant extension of the current Qualified Intermediary (QI) regime already in effect in the US. All FFIs are requested to register themselves with the US Internal Revenue Service (IRS).
The US law is aimed at foreign financial institutions (FFIs) and other financial intermediaries to ensure full FATCA compliance by US persons (citizens and residents) and avoid tax evasion through use of offshore accounts.
FFIs failing to meet this request will be subject to a 30% withholding tax on income from US sources, including dividends and interest paid by US corporations.
On February 14, 2013, the Swiss government and the US signed an agreement for the implementation of FATCA in Switzerland.
Reporting under the US Foreign Account Tax Compliance Act (FATCA) becomes effective as of 1 July 2014. The withholding tax for uncooperative account holders and FATCA non-participating financial institutions on US income also starts in 2014.
As announced by the IRS, the first FFI list was published on 2 June 2014 on the IRS portal with over 77,000 registered institutions. Other FFIs from countries under Inter Governmental Agreements (IGA) models 1 & 2 still have time to register until year end, thus, the list is anticipated to grow according to IRS to 500,000 registered FFIs. IRS will publish an updated list at the start of each month.
The latest list of registered FFI can be found here:http://apps.irs.gov/app/fatcaFfiList/flu.jsf
SIX has started the mapping process of matching the listed institutions with the available GIINs to the existing international identifiers (such as Moody’s, S&P, D-U-N-S, and pre-LEI), as a result, clients can continue to use their preferred identifier while achieving FATCA compliance. The full service will be completed in due time and the mapping process will continue as the FFI list expands.
Our clients can expect the most up to date FATCA relevant information from our reference data services for complete and accurate compliance processes.
SIX Financial Information's high-quality and on-time data takes care of instrument flagging enabling you to focus your efforts on improving systems and processes. Rest assured that SIX is closely following regulatory developments and perform updates to the FATCA data as needed.
SIX Financial Information will provide the international financial industry with the data required in order to comply with FATCA:
|Eases the burden on you having to identify instrument flags|
Less manual interventions, interfaces and errors ensures for a more seamless and speedy audit
Reduced costs of compliance with easy access to our extensive and reliable tax and compliance data
As an active participant in industry discussions on FATCA and other important cross-border taxes and regulations, SIX Financial Information host ongoing workshops with leading international banks and other stakeholders in order to ensure comprehensive and timely support for our clients.