Federal Account Tax Compliance Act (FATCA)

FATCA is an information sharing regime implemented by the US Government to crack down on tax evasion by individuals and entities. Under this agreement, financial institutions and US tax resident individuals will be required to disclose certain financial information to the Inland Revenue Service (IRS). For more information, kindly refer to the points below:


  • All US tax resident individuals must disclose details of their offshore bank accounts and assets to the IRS, if the cumulative value is higher than US$50,000;
  • US citizens; green card holders; and foreigners present in the US for 31 days in the calendar year, or 183 days during a consecutive 3-year period, including the current year will fall in this category.

Foreign Entities

  • All foreign entities must provide their FATCA status to financial institutions (both US and non-US based) when i) opening a bank account or ii) receiving passive US source income;
  • If a non-financial entity, with 10% stake by US tax resident individuals/entities, opens a new bank account, then the bank will provide the account information to the IRS annually;
  • In case of a financial entity, the bank will provide the account information to the IRS, even if the if US tax resident individuals/entities hold less than 10% stake in the entity;
  • When receiving passive income derived from US sources, all entities must provide their FATCA status, lest the amount to be received be subject to withholding tax of 30%.

Withholding Agents

  • Financial institutions including depository institutions, custodial institutions and investment vehicles must act as withholding agent on the behalf of IRS. Hence, our Clients who wish to register such entities and deal with international customers must comply with the preceding requirement;
  • Institutions may either register directly with the IRS or indirectly through their national governments. However, institutions which refuse to comply will be face a penalty of 30% withholding when receiving passive US sourced income.

Information to be provided to the IRS

  • For accounts of US tax residents or companies with US tax resident involvement, the following information will be reported to the IRS: i) name, address and tax ID of the account holder ii) account balances at year end and iii) income, dividends, interest or other amounts received throughout the year.

Contact us

For additional information on our FATCA services in USA, please contact our in-house country expert, Ms. Chrissi Zamora, directly:
client relationship officer - Chrissi
US sec us chamber US dhs US commerce department US irs US sba US aicpa acaus