The purpose of this update is to summarise the impact of these FATCA developments as they affect superannuation funds and certain related entities. To provide some context around this, a brief recap on FATCA and its potential application to the Australian superannuation industry is also included in the update.
- The Australian IGA includes a specific FATCA exemption for superannuation entities, public sector superannuation schemes, constitutionally protected funds and pooled superannuation trusts as they are defined under existing Australian superannuation and taxation legislation.
- The impact of the exemption is that these entities should neither be subject to the US account holder identification and reporting obligations under FATCA, nor have any income or other amounts which they receive in relation to their investments withheld upon at the 30 percent rate.
- A table which summarises the impact, risks and action items of FATCA (based on the final FATCA regulations and the IGA) on Australian superannuation funds is attached as an Appendix.