GENERAL INFORMATION ON FATCA

What is FATCA?

FATCA, stands for Foreign Account Tax Compliance Act, and is intended to make United States tax subjects who hold assets outside the United States, correctly file tax returns to the United States tax authorities, the IRS.

FATCA was enacted by the U.S. Congress in March 2010 as part of the Hiring Incentives to Restore Employment (HIRE) Act, is an important development in the United States efforts to combat tax evasion by U. S. persons holding investments in offshore accounts. FATCA requires Financial Institutions (FI’s) and (FFI‘s) Foreign Financial Institutions to report certain information about certain financial accounts held by U.S. persons or by foreign entities in which U.S. persons hold a substantial ownership interest.

In this regard, the government of Curaçao has signed an agreement with the Government of the United States of America to Improve International Tax Compliance and to Implement FATCA. This agreement called model 1 IGA, has been signed on December 12, 2014.

When does FATCA come into force in Curaçao?

As of July 1, 2014, all financial institutions based in Curacao are required by law to provide the tax authorities of Curaçao with information about customers who could have United States tax liability. Starting August 2015, the Curaçao tax authority forwards this information to the IRS.

What does United States tax liability mean?

If you have tax liability, this means that you are obliged to file a tax return in the United States. Whether you are required to pay tax depends, among other things, on the tax treaty between Curaçao and the United States or, for instance, your income. The IRS defines a United States taxpayer as a US Person.

What does this mean for you?

You may be contacted by Girobank if one or more of the following situations apply to you:

• You have a United States passport
• You live in the United States (or have a green card)
• You were born in the United States
• You have a United States residential or postal address or telephone number
• You make periodic money transfers to the United States
• You have granted a power of attorney to someone with a United States address or citizenship
• You have an In-Care-Of or Hold-Mail address.

Companies may also be contacted, for instance if they are domiciled in the United States or incorporated under US law. If you are potentially a US Person or you have a company with beneficial owners who potentially may be a US Person, then Girobank will ask you for a statement. The Girobank FATCA statement (Annex1) If one or more US Persons are identified as such, or if no cooperation is given to the request for information, Girobank will report details about your account to the Curaçao tax authority.

The Curaçao tax authority  on his turn will send this information to the IRS. If you believe you do not have tax liability in the United States, you can indicate this to Girobank. For instance, this could be the case if you are no longer a US citizen and can prove this with official documentation.

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