FATCA obliges all U.S. paying agents to withhold tax, at a rate of 30 per cent, from payments of United States (“U.S.”) source income to non-U.S. persons who are classified as “Financial Institutions” (“FIs”) unless that FI is located in a country which has entered into an IGA with the U.S. Internal Revenue Service (“IRS”) to report information on relevant account holders to the IRS. Where an FI is resident in a non-IGA country, the FI can register directly with the IRS and agree to report certain information about their U.S. accounts to the IRS in order to avoid being withheld upon.

The U.S. Treasury Department (“Treasury”) and the IRS issue regular updates announcing jurisdictions that have an IGA in effect through a listing on the Treasury and IRS websites. This list also includes jurisdictions that have reached agreements in substance with the United States on the terms of the IGA and have consented to be included on the website, even though those agreements have not been signed.
The most recent summarised list of countries with IGAs signed to date and those in negotiation is available to the left of this article.

A more detailed list is available on the Treasury and IRS websites.

How can we help?

Deloitte has a FATCA global centre of excellence aimed specifically at helping our clients analyse their responsibilities and risks to develop a tailored FATCA implementation plan.

• Advise on your FATCA obligations
• Identify and categorise all entities within scope
• Develop a compliance framework to meet your reporting requirements
• Conduct a data-mining exercise to identify U.S. persons and classify client base according to a risk-based approach
• Provide a training course on the general application of FATCA to your business, addressing the main areas of risk and possible exemptions available.