US signs FATCA pact with Bermuda

The United States Department of the Treasury has signed bilateral agreements with Bermuda and five other jurisdictions to implement the information reporting and withholding tax provisions, commonly known as the Foreign Account Tax Compliance Act (FATCA).

Enacted by Congress in 2010, the Treasury Department said these provisions target non-compliance by US taxpayers using foreign accounts.

With these most recent agreements, the United States has signed 18 FATCA intergovernmental agreements (IGAs), has 11 agreements in substance, and is engaged in related discussions with many other jurisdictions, the Department said.

The Treasury Department said besides Bermuda, the Netherlands and three United Kingdom Crown Dependencies - Jersey, Guernsey, and the Isle of Man - have signed various agreements with the United States to implement FATCA.

"FATCA continues to gather momentum as we work with partners worldwide to combat offshore tax evasion," said Deputy Assistant Secretary for International Tax Affairs Robert B. Stack.

FATCA seeks to obtain information on accounts held by US taxpayers in other countries and requires US financial institutions to withhold a portion of certain payments made to foreign financial institutions which do not agree to identify and report information on US account holders.

- CMC