• Service: Tax, Superannuation & Pension Funds, Topics, Financial Services Regulation, FATCA
  • Industry: Financial Services, Superannuation
  • Type: Regulatory update
  • Date: 8/05/2014

FATCA Update

FATCA: Where are we now?
This series provides an update on the status of the Foreign Account Tax Compliance Act (FATCA).

FATCA Update – Australian superannuation industry 

In welcome news for the Australian superannuation industry and the broader financial services sector, the Treasurer announced on 28 April 2014 that Australia and the United States had signed an intergovernmental agreement (IGA) to facilitate the implementation of the Foreign Account Tax Compliance Act (FATCA) regime to Australian financial institutions.

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.

Key points for superannuation funds

  • 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.

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KPMG's Superannuation practice offers a range of services to superannuation funds, life offices, employers and fund trustees.