Chris Lallemand (Smith & Williamson) discusses some contrasts between the UK implementing legislation for the UK/US IGA, equivalent US regulations and HMRC’s guidance
Many large financial institutions will have put significant effort into complying with their obligations arising from the US Foreign Account Tax Compliance Act (FATCA). The purpose of FATCA is to aid the US authorities in dealing with tax evasion by US citizens.
It requires financial institutions (subject to certain exceptions) to pass on information about US customers to the US tax authorities or be subject to a 30% withholding on withholdable payments received from other financial institutions.
Instead of being governed by the US rules and having to report directly to the IRS reporting UK financial institutions will be governed by: the
UK/US intergovernmental agreement (IGA)...
