US postpones Fatca until 2014

US tax authorities have postponed the implementation of the Foreign Account Tax and Compliance Act to allow firms more time to comply with the rules

The Internal Review Service has pushed backed the deadline to 1 January 2014 for institutions to have procedures in place to meet Fatca reporting requirements.

Institutions will also have until 1 January 2017 to begin withholding US tax from clients’ investment gains.

Fatca aims to tackle tax evasion by US taxpayers through the use of foreign accounts. The rules initially required foreign financial institutions to report certain information about financial accounts held by US investors from 30 June 2013. Firms that do not comply with Fatca face a 30 per cent withholding tax on US assets.