The United Kingdom signed an IGA with the United States on September 14, 2012. It was the first IGA signed with the United States, and it became the basic model for most of the countries they had to follow. The British IGA is a reciprocal agreement in which the United Kingdom and the United States will provide information on their citizens` investments abroad. In recent years, efforts to ensure compliance with tax rules through offshore investments have intensified considerably. To this end, laws developed by the United States have promoted the use of data exchange agreements worldwide under an initiative called the Foreign Account Tax Compliance Act (“FATCA”). Two versions of IGA, commonly known as Models 1 and 2, are now available. Model 8 Model 1 addresses FATCA compliance through partner country reports and information exchange under double taxation or tax information exchange agreements.9 Model 1A has a reciprocal version (Model 1A) and not reciprocal (Model 1B). Model 2 requires local legislative changes to allow for a direct report to the IRS, followed by requests from the relevant authority for more information.10 The contrast between the two versions lies mainly in the reporting of information made through the tax administration of the FATCA partner country as in Model 1 or directly to the IRS as in Model 2.11 – In accordance with the Taiwan Relations Act. , the contracting parties to the agreement are the American Institute of Taiwan and the Taipei Economic and Cultural Representative Office in the United States. In accordance with negotiations with Japan and Switzerland, the U.S.
Treasury issued on November 14, 2012 an IGA version called Model 2.2012.24 Model 2 IGA requires FFIs to record and report FATCA information directly to the IRS.25 1. Switzerland and the United States signed the Model 2 agreement on 14 February 2013. Switzerland, the first country to sign a Model 2 agreement with the United States, is currently amending its own laws by allowing Swiss ISPs to disclose information to US tax authorities. The ministry also defined the Intergovernmental Agreement (IGA) on FATCA of May 23, 2013 and the July 23, 2014 regulation on the implementation of FATCA (implementation regulation) (regulation) of November 3, 2015. On May 9, 2013, Model 1A IGA was amended to reflect information security concerns. Prior to the revision, the IGA was considered fully effective after the ratification of the agreement by the United States and FATCA`s partner country. However, as a result of the review, the United States will no longer be required to exchange information in accordance with a ratified reciprocalmodel 1A IGA if the United States is not satisfied that THE FATCA partner country has implemented the appropriate security measures and infrastructure to ensure that the information received remains confidential and used exclusively for tax purposes.15 Germany and the United States signed an IGA on May 31. , 2013. In accordance with the mutual IGA signed, it is expected that an agreement on the competent authority will follow soon.21 The German IGA has a specific list of companies and accounts exempt from tax, in the same way as the British agreement. Appendix II contains German investment funds that are considered non-compliant with the declaration and are therefore not required to conclude THE FATCA diligence vis-à-vis their investors.
Instead, this matter is settled by custodian banks, in which investors of German investment funds have their accounts.22 5.