• Service: Tax, Global Mobility Services, International Tax
  • Type: Regulatory update
  • Date: 6/11/2014

South Africa - FATCA intergovernmental agreement signed with United States 

June 11:  Representatives of the governments of South Africa and the United States signed on 9 June 2014 an intergovernmental agreement (IGA) intended to improve international tax compliance and to implement the Foreign Account Tax Compliance Act (FATCA).

According to a release from the South African Revenue Service (SARS), the IGA promotes transparency on tax matters and underscores growing international cooperation in the endeavor to end tax evasion worldwide.

The IGA—Agreement to Improve International Tax Compliance and to Implement the Foreign Account Tax Compliance Act—between the United States and South Africa is a reciprocal agreement, so that financial institutions in South Africa will report information about U.S. account holders to the SARS and, in return, SARS will relay that information, by means of automatic exchange of information to the IRS under the income tax treaty in force between the United States and South Africa.

Reciprocally, the IRS will provide similar information about South African account holders in the United States to SARS.

Text of the IGA is not yet available, but according to information posted on the U.S. Treasury website, the agreement with South Africa follows the Model 1 IGA.

June 12: The U.S. Treasury Department today posted text of the Model 1 IGA [PDF 440 KB] between South Africa and the United States.

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