FATCA Compliance

KHALED AHAMED KHAN

Senior Executive Officer
FATCA Cell, Head Office.
Dhaka.

1
What is FATCA?
FATCA: Stands for “Foreign Account Tax Compliance Act”
F = Foreign
A = Account
T = Tax
C = Compliance
A = Act
FATCA is a U.S. tax law that aims to prevent or detect tax
evasion by U.S. Persons .

2
Historical Background and Context:
FATCA was enacted by the U.S. Congress in March 18,
2010 as part of the Hiring Incentives to Restore
Employment (HIRE) Act.
It added a new chapter – Chapter 4 –to the Internal
Revenue Code (“I.R.C.”) which is known as FATCA
FATCA was effective from July 01, 2014

3
Why was F.A.T.C.A. passed?

8.7 million U.S. taxpayers

Hide billions of dollars

Avoid paying taxes.

4
 5
Why FATCA for us..??

FFIs must register and agree to report to the IRS or

face a 30% withholding tax on certain U.S. source
payments made to them.
Instruction from BANGLADESH BANK:
Bangladesh Bank instructed the banks through

1. BRPD circular No. 01 dated 16.01.2014

“…. to register the Bangladeshi banks with IRS to
comply with FATCA as well as to avoid the financial
losses for both bank and clients.”
6
Implementation of FATCA
compliance in AIBL

7
AIBL initiatives for FATCA compliance:
AIBL is committed to comply with FATCA regulations. In this
regard AIBL management nominated Jb. Kazi Mahmood
Karim, SEVP as Responsible Officer (RO) and constituted-
FATCA cell.
Cell is Headed by Jb. Aminul Islam Bhuiyan, SEVP, ICTW.
Dealing Officer- 1. Mohammed Sadequer Rahman, PO.
2. Khaled Ahamed Khan, SEO.

8
 1. IRS Registration:

 AIBL has successfully registered to IRS as a PFFI through

IRS website on 10.04.2014 and approved on 11.04.2014
 Renew date:18.07.2017

 AIBL has received the “Global Intermediary Identification

Number” (“GIIN”)

 Our GIIN No.: “S2WRLR.99999.SL.050”

9
2. Identify new clients:

AIBL needs to carry out process from 1 July 2014

for clients that are individuals in order to be sure that
all US Persons are accurately identified at account
opening.

The client’s self-declaration and consent for the

FFI to disclose their information to the IRS.
(i.e. FATCA Supplementary Form)

10
 3. Monitor for changes in status:
FFIs are required to put in place procedures to monitor if
an account changes its status to US or changes its FATCA
status.

For instance, if an individual customer changes its address

to a US address or a FFI counterparty loses its FATCA
participating status, the FFI would need to track this and
take appropriate action within the timeframe defined by the
Regulations.

11
Now, the question is……….

What is the duties &

responsibilities
of an officer regarding
FATCA?
12
Special concern 01 : Implementation of
Instruction circular 83

14
15
16
17
18
 How to fill in
FATCA Supplementary
Form (FSF)

19
FATCA Supplementary Form

20
21
22
23
Bangladesh Bank has further guided concerned Banks
that:
“As the agreement requires disclosures which would
normally be breaches of the banker’s general duty of
confidentiality under prevalent Bangladeshi laws
including the Bankers’ Books Evidence Act 1891;
banks are to obtain written consents from their
customers before reporting the requested information to
IRS.”

24
25
26
27
28
29
 Process of Account
opening/Reporting in
Ababil Software.

30
 ETC.

(End of Thinking Capacity)

38
 Case Study 01 :

Suppose, one of our client is a U.S. person

but he holds a joint account with a non U.S.
person.

Will the joint account be treated as a U.S.

person for the purpose of FATCA reporting
in its entirety?

39
 Case Study 02:

Suppose, one of your client is a shareholder/

director/ partner with 10% ownership of an
entity that has several non U.S. persons as co-
owners.

Will the jointly owned entity's account be

treated as a U.S. account for the purpose of
FATCA reporting in its entirety?
40