1. Inter-governmental agreements (IGAs) aim to improve international tax compliance through domestic reporting and the automatic exchange of information.
2. IGAs establish legal frameworks for the exchange of information between financial institutions and tax authorities in other jurisdictions.

Foreign Account Tax Compliance Act (FATCA)

1. FATCA requires financial institutions outside the USA to report information on financial accounts held by their US customers to the Internal Revenue Service (IRS).
2. The information to be reported by foreign financial institutions is equivalent to that required to be reported by US citizens in their tax returns.
3. If financial institutions do not comply with the US regulations, a 30% withholding tax is imposed on US source income of that financial institution. Financial institutions are also required to close accounts where their US customers do not provide the information that has to be collected.

The agreement between Jersey and the US

1. On 13 December 2013, Jersey and the US signed an agreement to improve international tax compliance and to implement FATCA based on the model IGA. As a result, the withholding tax and account closure requirements will not apply, apart from in circumstances of unresolved significant non-compliance.
2. Under the terms of the agreement, financial institutions will provide the Jersey Comptroller of Taxes with the required information. The Comptroller will then forward that information to the Competent Authority in the USA.
3. Download a copy of the agreement signed between Jersey and the US (size 461kb) =  http://bit.ly/1yFgRvmand your money/LD USJerseyIGA 20131210.pdf

Implementation dates

1. We will have until September 2015 to report information relating to the 2014 calendar year.
2. Financial institutions will have to report the information to us prior to these dates. The timescales are still being agreed.

IT guidance notes

1. The Jersey Taxes Office has produced draft IT guidance notes to help local financial institutions to prepare for the exchange of information with the Comptroller of Taxes.
2. These notes include details regarding our new online portal and how to register, the required file format for data exchange and the test platform that is being developed to help financial institutions test their file formats.
3. Be aware that these are draft guidance notes and as such may be liable to change.
4. Download US-IGA (FATCA) IT guidance notes (size 431kb) =  http://bit.ly/1yFgRvm and your money/ID US-IGA IT guidance notes 20140804 LB.pdf

Domestic regulations

1. The exchange of information with the USA under the IGA is governed in Jersey by the relevant regulations. These regulations set out:
   1. the role and responsibilities of Jersey financial institutions
   2. the timescales for reporting information to the Comptrolle
   3. the penalties for non-compliance with the regulations
2. certain exemptions for the exchange of information

Read the Taxation (Implementation) (International Tax Compliance) (United States of America) (Jersey) Regulations 2014 on the Jersey Law website =

http://bit.ly/1DBTjqx

 http://bit.ly/1yFgRvm