FATCA & CRS
The Foreign Account Tax Compliance Act (FATCA), Common Reporting Standard (CRS), and how it affects SCU Members
In 2014, Canada and the United States signed an inter-governmental agreement known as the Foreign Account Tax Compliance Act (FATCA). This Act requires Canadian financial institutions, SCU included, to identify and report U.S. members to the Canada Revenue Agency (CRA).
The Common Reporting Standard (CRS) is an international reporting standard for automatic exchange of financial account information between tax administrations. As of July 2017, Canadian financial institutions, SCU included, must identify accounts held by members who are tax residents in countries other than Canada or the U.S. and report this information to the CRA.
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We diligently review FATCA and CRS regulations to ensure we are reporting accurately, while maintaining our high privacy standards.
All members of SCU are required to complete a self-declaration to confirm their country of tax residence. This includes providing all required information, such as foreign tax identification numbers.
Members must also inform SCU of any changes of circumstance, as a new tax declaration may be required. Members must advise of the change and complete a new form within 90 days. Failure to complete a new declaration may result in a member’s account becoming reportable.
What happens if I refuse to provide the requested information?
CRA imposes strict penalties on financial institutions that do not obtain self-declarations for their members. This is why it is mandatory
for all members to complete this documentation to hold accounts with SCU.
CRA also imposes penalties to members for failing to provide required information in relation to their circumstances. Failure to provide a foreign tax identification number from a jurisdiction that provides these carries a penalty of $500 (CRS). Failure to provide a U.S. tax number carries a penalty of $100 (FATCA).
I am not a U.S. or international person. What do these laws mean for me?
We are required to have all members, Canadians included, declare their tax residency and provide supporting documentation when opening a membership.
If you have an existing account and there is an indication that you may be either a U.S. or international person, we may ask you to complete a form declaring your tax residency and provide additional documentation or information to support
I am not a U.S. person but I have an account in U.S. Dollars. Does this mean my accounts will be reported to the CRA?
No, the currency of an account has no impact on whether or not it is treated as a reportable account.
Whom should I contact with more questions?
You may want to consult with your personal tax advisor or visit the CRA or IRS websites for more information.