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January 2013 changes to the taxable asset reporting in the US
Attached is a an update regarding the change of procedure in the reporting of taxes and the I.R.S. action in relation to US
non-residents. Under the incoming Foreign Account Tax Compliance Act, known as FATCA. It is
primarily aimed at U.S. citizens but has a serious implications on returns and tax reporting for U.S. non-residents in Latin
America that hold accounts in the U.S.
• IN AN EFFORT TO CLOSE DOWN THE ABILITY OF U.S. RESIDENTS TO HIDE MONEY IN TAX HAVENS THE US GOVERNMENT HAVS PASSED NEW LAWS REGARDING THE EXCHANGE OF INFORMATION WITH FOREIGN COUNTRIES AND THEIR CITIZENS WHO HAVE ACCOUNTS IN THE U.S.. THIS IS IN AGREEMENT THAT THE U.S. WILL RECIEVE INFORMATION IN RETURN FROM THESE COUNTRIES REGARDING U.S. RESIDENTS AS PER THE RECENT PRECEDENT SET BY THE CREDIT SUISSE INCIDENT IN SWITZERLAND.
• AS A RESULT FUTURE RETURNS FROM ACCOUNTS HELD IN THE U.S .AND THE VARIOUS HOLDINGS WILL BE LEVIED WITH A WITH HOLDING TAX OF 30% ON NON-RESIDENTS IF A W8-BEN FOR IS NOT COMPLETED.
• FROM 1ST JANUARY 2013 BANKS WILL BE REQUIRED BY LAW TO REPORT TO THE I.R.S. ANY U.S. NON-RESIDENT WHO COMPLETES A W8BEN FORM. THIS IN TURN WILL BE REQUIRED UNDER THE NEW LAW TO BE REPORTED TO THE TAX AUTHORITIES WHERE THE NON RESIDENT IS ACTUALLY RESIDENT.
• THERE HAS BEEN A SECTION ADDED FOR THIS ON THESE W8BEN FORM TO ASSERTAIN NAME AND RESIDENTIAL ADDRESS FOR THE ACCOUNT HOLDER.
• INVESTORS THAT HAVE NOT BEEN DECLARING THESE ACCOUNTS HELD IN THE US WILL BE PROSECUTED BY FEDERAL LAW IN THE U.S. AND POTENTIALLY IN THEIR RESIDENTIAL COUNTRY FOR THE COMPLETE TIME THE ACCOUNTS HAVE BEEN HELD.
WHAT HAS HAPPENED
THE POTENTIAL IMPLICATIONSCriminal Consequences:
Criminal charges may be brought against an individual within six years of the date that the tax return should have been filed. Additionally, non-filers can be fined up to $25,000 per year and may also be put in prison for one year for each year of non-filing. If a W8 BEN form is completed then it is a declaration that the individual will pay taxes in their resident country. If this is not done then this is evasion of U.S. taxes under the new FATCA legislation.
Civil Consequences:
Civil penalties include assessing interest of taxes due for the entire period of time for which they are outstanding. While criminal consequences are limited to 6 years, civil penalties can accrue indefinitely.
Reasons why you need advice TODAY!!!If a W8-BEN form is not completed then 30% tax rate on returns after 1st January 2013
W8-BEN form completion to not pay taxes through non-residency will expose clients to possible:
• Potential prosecution through tax evasion laws in the US• Freezing of accounts in the US whilst investigations take place• Heavy fines if proven guilty• Backdating of the fines and interest charged• Seizure of assets to pay the fines
Do not be exposed
• Safety of non judicial reporting requirements in the UK.• Safety of minimum 90% government backed investor protection scheme.• No liability to UK taxes if non resident for less than 3 months annually.• NO LIABILITY = NO AVOIDENCE = NO PROBLEMS
Please contact myself by email or on the contact numbers provided to find out how we can help you.
Ron MacRall+52 55-4506-6132
www.internationaladvisor.com
“planning for your future………today”
