FATCA – Which Countries Are In And Out

The controversial US Foreign Account Tax Compliance Act (FATCA) law is set to start from July 1, 2014, so with less than 21 days to go, here’s a look at which countries are in and who is outside of the tax network.

The latest figures from the US Treasury suggest 72 countries are at various stages of FATCA compliance.

Signed and sealed

The Treasury has announced completed FATCA agreements to automatically swap tax data with 30 countries:

  • Australia
  • Belgium
  • Bermuda
  • Canada
  • Cayman Islands
  • Chile
  • Costa Rica
  • Denmark
  • Finland
  • France
  • Germany
  • Gibraltar
  • Guernsey
  • Hungary
  • Ireland
  • Isle of Man
  • Italy
  • Jamaica
  • Japan
  • Jersey
  • Malta
  • Mauritius
  • Mexico
  • Netherlands
  • Norway
  • Slovenia
  • South Africa
  • Spain
  • Switzerland
  • United Kingdom

Agreed in principle

Another 25 countries have agreed FATCA treaties with the US in principle and are considered FATCA compliant even though the agreements are awaiting final signature:

  • Austria
  • Azerbaijan
  • Bahamas
  • Brazil
  • British Virgin Islands
  • Bulgaria
  • Croatia
  • Cyprus
  • Czech Republic
  • Estonia
  • Hong Kong
  • India
  • Israel
  • Kosovo
  • Latvia
  • Liechtenstein
  • Lithuania
  • New Zealand
  • Poland
  • Portugal
  • Qatar
  • Romania
  • Singapore
  • Slovak Republic
  • South Korea

Under negotiation

Negotiations to put a FATCAQ treaty in place are under way with a further 17 countries:

  • Argentina
  • Bahrain
  • Barbados
  • Curacao
  • Ghana
  • Gibraltar
  • Honduras
  • Lebanon
  • Luxembourg
  • Malaysia
  • Russia
  • Seychelles
  • St Maarten
  • Taiwan
  • Thailand
  • Trinidad and Tobago
  • United Arab Emirates

Russia is the odd man out. Because of the violence and political crisis in The Ukraine, the US Treasury has refused to negotiate a FATCA treaty with Russia. Instead, Russian banks must comply by signing up individually on the FATCA portal.

FATCA FFI list

The first list of FATCA compliant foreign financial institutions (FFI) reporting outside international government agreements had more than 77,000 banks and other foreign financial institutions detailed. The next list is due on July 1, 2014.

What is FATCA?

FATCA is a law aimed at identifying US taxpayers controlling bank accounts and investments overseas who are not declaring any taxable income or chargeable gains.

The US Internal Revenue Service (IRS) intends to cross-reference financial reports from foreign tax authorities and banks against US tax returns to make sure any US taxpayer with overseas assets is paying the correct amount of tax.

In return, under many of the inter government agreements; the IRS will give reciprocal financial information about the financial affairs of foreign nationals with bank accounts and investments in the USA.

Banks failing to comply with FATCA face heavy fines and other sanctions that could stop them trading.

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16 COMMENTS

  1. FATCA is a disgrace to every US expat working abroad. Proof positive of Washington’s inept and unthoughtful policy application. Mindset is just “go for the money”. Don’t worry about who it is unfair to or what it throws under the bus. BasT_ reds all of them .
    FATCA will financially be a disaster for US government, They will not get NEAR to what they expect to fill coffers.

  2. Do US Govt also share the financial information when asked by the other nation who got FATCA treaty with US ? This is a million dollar question !

    • No, they don’t, and never will. But they lie through their teeth and say they will. Americans can only be trusted to do whatever is in their own best interests – never yours.

  3. Congress no doubt thinks it is being very clever with this law. The bank account confiscation penalties of 25% per year are simply their way of saying: if you don’t fill out papers properly, we will assume that the contents of your bank account represents current income on which you should be paying tax to the US. 25% or so.

    If someone happens to have SAVINGS (as opposed to income) in a foreign country, these laws are unholy nightmares. No tax due (because no income) but WHOPPING big penalties, confiscation, even threats of prison. This for the crime of: not filling out a paper.

    I’ve been a Democrat for most of my life, but the fact that the Democrats refuse to hear the voices of the people who are being hurt by this law is moving me to change my party affiliation. Not that that’s a very powerful response on my part, but I sure can’t see making donations to and throwing support behind a party that refuses to take seriously some really odious collateral damage like this.

  4. Surely, there must be a few small banks in every country that receive no income from any US company or US Treasury bond (and who have no customer who receives such either). These banks will be in a position to charge a hefty premium to US citizens who want to open a bank account.

  5. So, the following are “under negotiation”: Argentina, Bahrain, Barbados, Curacao, Ghana, Gibraltar, Honduras, Lebanon, Luxembourg, Malaysia, Russia, Seychelles, St Maarten, Taiwan, Thailand, Trinidad/Tobago, UAE.

    I would bet that a few of these never cave in to Obama.

    Then, of course, things could change again with the next POTUS.

      • I don’t know the answer.

        But, Thailand aside, I would be very, very surprised if “loopholes” don’t begin to spring up before long. There’s just too much money to be had for those banks willing to “bend the rules”. And at the same time, there will be money to be had for members of the U.S. Congress who are willing to introduce loopholes into the law (although nothing in that regard will happen while Obama is still POTUS).

    • Where is China on this list? I have been reading articles that China has “agreed.” My friend just finished renouncing his citizenship in the US…smart guy.

  6. FATCA has cost many poor and retired people like myself living over seas a fortune in filling it is a disgrace raping Americans abroad and fostering people who are honest to give up their citizenship or to circumvent the law legally.

  7. If IRS remove the penalty to us citizens with foreign acc , then every one will declare what ever they had not declare out of us

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