Foreign Account Tax Compliance Act (FATCA) in Canada
The aim of the Foreign Account Tax Compliance Act (FATCA) is to prevent U.S. taxpayers from using accounts held outside of the U.S. to evade taxes.
FATCA was signed into U.S. law in March 2010. On February 5, 2014, Canada and the United States signed an intergovernmental agreement regarding FATCA. Under that agreement, Canada agreed to pass laws requiring financial institutions to report annually to the Canada Revenue Agency (CRA) on specified accounts held in Canada by U.S. persons. The CRA will forward this reporting to the IRS under the provisions and safeguards of the Canada-U.S. Tax Convention. Canadian tax regulations related to FATCA will come into effect in stages; the first stage began on July 1, 2014.
What does this mean to Scotiabank and our customers?
The Scotiabank Group has always been committed to keeping clients' personal information accurate, confidential, secure, and private. Our response to Canadian tax regulations related to FATCA will be held to our standard of strict compliance with Canadian privacy laws, and our approach will reflect our longstanding commitment to client privacy and client service.
We expect Canadian tax regulations related to FATCA to have no impact on the vast majority of our clients. In any case where we determine that a specific personal or non-personal account may be affected by these laws, we will:
- contact the account holder to explain why the account may be affected; and then
- work with the client to ensure that the situation is handled correctly.