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. Canadian tax regulations related to FATCA came into effect in stages; the first stage began on July 1, 2014.
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 forwards this reporting to the IRS under the provisions of the Canada-U.S. Tax Convention.
What does this mean to Scotiabank and our customers?
In accordance with Canadian Regulations related to FACTA and existing obligations under Know Your Customer (KYC) regulations, Scotiabank collects self-certifications from all new customers.
Existing customers opening new in-scope accounts or providing information identifying a U.S. indicator, are also required to complete a self-certification form attesting to their tax residency status.
If a customer does not provide a self-certification, the Bank may be not be able to open a new account for the customer.
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 are 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.