Wealth Manager - the site for professional investment managers

Register to get unlimited access to all of Citywire’s Fund Manager database. Registration is free and only takes a minute.

IMA urges HMRC to consult further on Fatca reporting duties

IMA urges HMRC to consult further on Fatca reporting duties

The Investment Management Association (IMA) has called on HM Revenue & Customs (HMRC) to consult further on which financial firms will be responsible for reporting on US clients under the incoming Foreign Account Tax Compliance Act (Fatca).

Fatca was drafted in March 2010 to clamp down on tax avoidance by US persons who invested through what it calls a Foreign Financial Institution (FFI).

In September the Tax Incentivised Savings Association (Tisa) warned that financial advisers could be subject to the onerous reporting requirements of Fatca following a bilateral agreement between the UK and the US reached that month.

Jeffrey Mushens, Tisa technical director, warned that the agreement resulted in UK pension and ISA providers being granted exemption from Fatca, but advisers could be caught by the act’s reporting regime.

The IMA response paper argued that there was still uncertainty about which companies and firms would qualify as a UK Financial Institution (UKFI). It added it was concerned about the potential impact and scope of UKFIs.

‘It would be helpful if UK regulations and guidance could limit responsibility for the actions of third party service providers to those directly contracted by the UKFI,’ it said.

The response paper stated that until more information was available, UKFIs would be unable to make meaningful progress as to how they could implement their Fatca due diligence.

It said: ‘The IMA shares the concerns expressed by other industry bodies on the continued uncertainty surrounding the registration process for UKFIs. There is now an urgent need to clarify how the registration process will work in practice, and how the UK regulations will mandate all UKFIs to register with the US.’

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Citywire TV
Play JPM’s Negyal: Back divis to temper EM volatility

JPM’s Negyal: Back divis to temper EM volatility

Omar Negyal, co-manager of the JPMorgan Global Emerging Markets Income trust, says a dividend approach to emerging markets reduces the volatility of investing in the asset class.

Play WMR: Why Russia will lose this war

WMR: Why Russia will lose this war

Author and journalist Adam Lebor believes a perfect storm is brewing when it comes to the Russian economy. .

Play WMR: Gerard Lyons warns Asia is the real risk, not Russia & Ukraine

WMR: Gerard Lyons warns Asia is the real risk, not Russia & Ukraine

Chief economic adviser to London mayor Boris Johnson outlines the geo-political risks in Asia and explains why the risk of another eurozone crisis must not be underestimated.

Your Business: Cover Star Club

Profile: 'new normal' now is as dangerous as when it was applied to tech

Profile: 'new normal' now is as dangerous as when it was applied to tech

7IM's CIO Chris Darbyshire says he has been re-energised by his new role, but has little time for 'new normal' doom-mongers

Wealth Manager on Twitter