Automatic Exchange of Tax Data

The Foreign Account Tax Compliance Act (FATCA) took effect in 2014 and has literally swept the globe. FATCA requires foreign banks to disclose the identity and details of Americans with foreign accounts over $50,000 and report the information back to the U.S. government. Non-compliant institutions could have their U.S. assets frozen or face a huge penalties. So far, over 145,000 financial institutions have registered through the IRS FATCA Registration System. The U.S. has more than 110 intergovernmental agreements (IGAs), either signed or agreed in substance.

There are two types of agreements. The first agreement known as Model 1 IGA would require the Foreign Financial Institutions (FFIs) to report all FATCA-related information to their own governmental agencies, which would then report the FATCA-related information to the U.S. government. Some Model 1 IGAs are reciprocal, requiring the U.S. to provide certain information about residents of the Model 1 country to the Model 1 country in exchange for the information that country provides to the U.S. An FFI covered by a Model 1 IGA will not need to sign an a FFI agreement, but it will need to register on the IRS FATCA Registration Portal or file a Form 8957.

The second version of the IGA is Model 2 IGA which would require FFIs to report information directly to the IRS. Under such IGA, FFIs will need to register with the IRS, and certain FFIs will sign a version of the FFI agreement modified to reflect the IGA.

Most of the countries which signed the IGA are under Model 1 with some are nonreciprocal (e.g. Cayman Islands). However, below is the list of the countries are signed under Model 2 which means the local FFIs are required to report information directly to the IRS.

1.       Armenia (agreement in substance)

2.      Austria

3.      Bermuda

4.      Chile

5.      Hong Kong

6.      Iraq (agreement in substance)

7.      Japan

8.     Macao

9.      Moldova

10.  Nicaragua (agreement in substance)

11.   Paraguay (agreement in substance)

12.  San Marino

13.  Switzerland

14.  Taiwan

15.  Here is a list of countries which are under IGA Model 1.

16.  Algeria

17.   Angola

18.  Anguilla

19.  Antigua and Barbuda

20. Australia

21.  Azerbaijan

22. Bahamas

23. Bahrain

24. Barbados

25. Belarus

26. Belgium

27.  Brazil

28. British Virgin Islands

29. Bulgaria

30. Cabo Verde (agreement in substance)

31.  Cambodia

32. Canada

33. Cayman Islands

34. China (agreement in substance)

35. Colombia

36. Costa Rica

37.  Croatia

38. Caracao

39. Cyprus

40. Czech Republic

41.  Denmark

42. Dominica (agreement in substance)

43. Dominican Republic

44. Estonia

45. Finland

46. France

47.  Georgia

48. Germany

49. Gibraltar

50. Greece

51.  Greenland

52. Grenada

53. Guernsey

54. Guyana

55.  Haiti (agreement in substance)

56. Holy See

57.  Honduras

58. Hungary

59. Iceland

60. India

61.  Indonesia (agreement in substance)

62. Ireland

63. Isle of Man

64. Israel

65. Italy

66. Jamaica

67.  Jersey

68. Kazakhstan (agreement in substance)

69. Kosovo

70. Kuwait

71.   Latvia

72.  Liechtenstein

73.  Lithuania

74.  Luxembourg

75.  Malaysia (agreement in substance)

76.  Malta

77.  Mauritius

78. Mexico

79.  Montenegro (agreement in substance)

80.Montserrat

81.  Netherlands

82. New Zealand

83. Norway

84. Panama

85. Peru (agreement in substance)

86. Philippines

87. Poland

88. Portugal

89. Qatar

90. Romania

91.  Saudi Arabia

92. Serbia (agreement in substance)

93. Seychelles (agreement in substance)

94. Singapore

95. Slovak Republic

96. Slovenia

97.  South Africa

98. South Korea

99. Spain

100.    St. Kitts and Nevis

101.     St. Lucia

102.    St. Vincent and the Grenadines

103.    Sweden

104.    Thailand

105.     Trinidad and Tobago

106.    Tunisia (agreement in substance)

107.     Turkey 

108.    Turkmenistan (agreement in substance)

109.    Turks and Caicos Islands

110.     Ukraine

111.       United Arab Emirates

112.      United Kingdom

113.      Uzbekistan

114.   Vietnam