FATCA update: Indian Government notifies rules for FATCA reporting; due date for 2014 reporting set at 31 August 2015

 

The Indian Government signed an Inter-Governmental Agreement (IGA) with the United States (US) on 9 July 2015 to implement the Foreign Account Tax Compliance Act (FATCA) in India (refer to our newsflash dated 10 July 2015 for details). According to the IGA read with the FATCA provisions, foreign financial institutions (FFIs) in India are required to report tax information about US account holders to the Indian Government which will, in turn, relay that information to the US Internal Revenue Service (IRS).

Furthermore, the US IRS will provide similar information about Indian citizens having any accounts or assets in the US. This automatic exchange of information is scheduled to begin on 30 September 2015.  

Following the signing of the IGA, on 7 August 2015, the Indian Government enacted rules relating to FATCA reporting in India. This news alert provides a snapshot of the new rules and also provides a brief overview of the due diligence requirements and information that needs to be maintained and reported by financial institutions.