The Foreign Account Tax Compliance Act ("FATCA") is tax legislation that was passed in the United States in 2010. FATCA is intended to prevent "U.S. persons" from evading U.S. tax using financial accounts held outside of the United States.
FATCA implementation begins July 1, 2014.
Non-U.S. ("foreign") financial Institutions will need to identify and report all “financial accounts” for specified U.S. persons and certain U.S. owners of non-U.S. entities. Financial accounts include bank, brokerage and other custodial accounts.
Under U.S. tax law, you are considered a U.S. person if you are:
You may also be considered a U.S. person if you spend considerable time in the U.S. in one year or over a period of years.
U.S. corporations, partnerships, estates and trusts are also U.S. persons.
Every non-U.S. ("foreign") financial institution globally must comply with FATCA or potentially be subject to a 30% withholding tax on all U.S source income.
While considerable uncertainty still exists regarding the obligations that Canadian Banks will face under FATCA, TD will comply with all applicable laws and regulations in the jurisdictions where TD operates.
TD is committed to providing impacted customers with support and information to ensure they receive a comfortable experience once the law comes into effect.
For more information, please contact your tax advisor to better understand how FATCA impacts you or your business. Additionally, the Canadian Bankers' Association (CBA) website can provide you with background information on FATCA.
The above information is intended to provide general guidance only, and is not an exhaustive analysis of all provisions of FATCA. The above information should not be construed as legal or financial advice.