Helping you understand the Foreign Account Tax Compliance Act
‘Trusts are an effective way of securing wealth for future generations. We can help you make sure your trusts are managed properly and internationally compliant’
With the increase in global movement of workers, the US government is concerned that some US citizens are not declaring their financial interests to the US Internal Revenue Service (IRS). To counteract this the Foreign Account Tax Compliance Act has been introduced by the US and adopted by the UK. This affects trustees of many trusts even when the trust does not have US beneficiaries.
What is FATCA and do I need to do anything with my trust?
Under Foreign Account Tax Compliance Act, or FATCA as it’s commonly known, the UK along with a number of other countries have agreed to report on payments to all beneficiaries of certain trusts from their jurisdictions.
FATCA applies to entities not individuals. Trusts and family investment companies come within the definition of entities for the purposes of FATCA.
Trustees have several options on how they can manage their trust to become compliant which are detailed in our factsheet.
Our team have worked closely with the professional advisory association STEP in their translation of this act into guidelines and so are experts in ensuring their clients are fully compliant. They can provide advice on What is FATCA and can even help you simplify your trust’s management by using our trust corporation. This is particularly beneficial for family trusts.