Introduction to Foreign Account Tax Compliance Act (FATCA)

FATCA (Foreign Account Tax Compliance Act) requires all non-US financial institutions to search their records for customers with indicate a US person status and collect information about the tax residency (and Citizenship). FATCA applies to both personal and business accounts.

CRs (Common Reporting Standard) is a global reporting standard for the automatic exchange of information (AEoI). CRS allows tax authorities to obtain a clearer understanding of financial assets held abroad by their residents, for tax purposes.

A TIN (Tax Identification Number) identifies taxable persons (both personal and artificial persons) in the respective geography in which they operate. There may be instances where obtaining TIN is not required. In such cases the reason for non-obtaining of TIN is required under FATCA regulations.

FATCA and CRS reporting requirements validates TIN. If TIN is not available, then the reason for not having TIN has to be mentioned mandatory.