• Service: Tax, Global Compliance Management Services, International Tax
  • Type: Regulatory update
  • Date: 2/5/2014

Canada - FATCA agreement with United States 

February 5: Canadian entities that will be treated as “foreign financial institutions” must now consider their potential requirement to register with the U.S. Internal Revenue Service (IRS) under the U.S. Foreign Account Tax Compliance Act (FATCA), now that an intergovernmental agreement (IGA) between Canada and the United States was signed today.

Not only Canadian financial institutions, but certain other non-U.S. entities, must comply with new information gathering and reporting requirements that generally take effect 1 July 2014 under FATCA. These rules include registering as participating foreign financial institutions with the IRS, among other things.

Canada’s Department of Finance released a 42-page package of draft legislation to implement the agreement. This legislation provides further guidance to Canadian entities on how to implement the IGA, including timelines and penalties for non-compliance. The closing date for comments to Finance is 10 March 2014.

Read a February 2014 report prepared by the KPMG member firm in Canada: Canada Signs FATCA Agreement with U.S.

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