SIX Securities Services to meet FATCA deadlines
At its meeting in early December, the SIX Securities Services leadership team agreed on a plan to ensure it is FATCA-compliant by the deadline of January 2015. A dedicated project team is now in place and reviewing all possible impact scenarios for SIX Securities Services companies as well as - where feasible - for its customers.
Retrospect - FATCA’s key points and consequences
The Foreign Account Tax Compliance Act (FATCA) was signed into law by the US President in 2010 under the Hiring Incentives to Restore Employment (HIRE) Act. The new legislation seeks to identify US taxpayers with offshore accounts all around the world and so reduce tax evasion.
FATCA will have a direct impact on most financial institutions, irrespective of where they are located, if they have either proprietary investments in the US or US account holders. A financial institution is defined as foreign financial institution (FFI) and has the option to enter into an individual contractual agreement with the US Tax Authority (IRS - Internal Revenue Service). Within that agreement, the FFI is obligated to identify and report each and every US taxpayer to the IRS, including all payments which these taxpayers have received from the respective FFIs. If there is no agreement between the FFI and the IRS, the FFI faces an additional 30% withholding tax on US-sourced income and sales proceeds.
"Our aim is to meet the necessary FATCA milestones and ensure that we, as the infrastructure provider for Switzerland - and on behalf of our customers - are compliant," explained Robert Almanas, member of SIX Securities Services leadership team, and a key representative on the in-house FATCA project team.
Almanas went on to explain, "this is a multi-year project requiring in-depth analysis, impact assessment and resource deployment. This is why we have committed to a full-time team, separate budget and key milestones for deliverables."
Over the course of the project, SIX Securities Services will keep its clients informed through a combination of updates on its website, as well as client meetings and presentations.
For more information, please contact your Global Client Relationship manager.