8. FATCA – US FOREIGN ACCOUNT TAX COMPLIANCE ACT
The US Foreign Account Tax Compliance Act 2010 comes into effect in 2014.
The aim of this legislation is to ensure that US citizens pay US tax on income arising from overseas investments.
The Finance Act 2013 introduced legislation which allows for the Irish Revenue Commissioners to make regulations for the purpose of implementing this Ireland US agreement.
The regulations will require that certain financial institutions register and provide a return of information on accounts held, managed or administered by the financial institution. A return of information on payments must also be made.
The financial institutions will be required to obtain a US TIN from account holders.
Finance Act 2013 empowers Revenue officers to enter the premises of the financial institution at all reasonable times to ensure the correctness and completeness of a return and to examine the administrative procedures in place for the purposes of complying with the financial institution’s obligations under the regulations.
Section 891E(10) authorises Revenue to communicate the information obtained to the Secretary of the U.S. Treasury within nine months of the end of the year in which the return is received, notwithstanding Revenue’s obligation to maintain taxpayer confidentiality.
Section 32 of the Finance Act 2013 that introduced the new s.891 is enabling legislation. The regulations will contain their own commencement provisions.