Tax Compliance  

FATCA Regulations

Background: 

The United States enacted the Foreign Account Tax Compliance Act into law in March 2010. The US government enacted FATCA primarily to identify US persons who are earning income outside of the United States. FATCA rules came into effect July 1, 2014.

FATCA requires non-US financial institutions, including banks, credit unions and mutual fund dealers from countries around the world to report information on US persons who have investments and accounts with these institutions. Canada, along with other countries, is required to report the required FATCA information to their respective country’s revenue agency. For Canadian financial institutions this means each institution reports FATCA information to the Canada Revenue Agency (CRA), which in turn reports to the US Internal Revenue Service (IRS).

How does this impact the credit union and our members?

The Credit Union is committed to protecting your privacy by keeping your personal information accurate, confidential, and secure. Our response to the Canadian tax regulations associated with FATCA will be held to the same high standard we use today to comply with British Columbian privacy laws and our commitment to member privacy.

Who is a US person?

• A US citizen (including dual citizens)
• A US resident alien for tax purposes (a lawful permanent resident of the US but not a citizen)
• A US partnership or corporation
• Any estate of a US person
• Any trust if a court within the US has the power/authority to supervise the administration of the estate and/or if one or more US persons have the authority to control all substantial decisions of the trust

Does FATCA apply to businesses or just individuals?

• FATCA applies to both businesses and individuals.

How can I get more information on FATCA?

You can find more FATCA information here:

• Department of Finance Canada 
• Canada Revenue Agency 
• IRS

You may also want to seek legal or other professional advice relevant to your own financial situation.

Common Reporting Standard (CRS) 

Background:

The Common Reporting Standard (CRS) is a new international standard for the automatic exchange of financial account information between tax jurisdictions for the purposes of fighting tax evasion and promoting voluntary compliance with tax laws. Canada and close to one hundred other jurisdictions have committed to the implementation of CRS and the CRS is endorsed by the Organization for Economic Co-operation and Development (OECD), the G20 and other international bodies as the new international standard for the automatic exchange of tax information.

The Government of Canada passed laws to implement CRS in Canada in 2016.

Effective July 1, 2017 Prospera, along with all other Canadian financial institutions, will be required to collect foreign resident tax information, including the Tax Information Number (TIN) from all new members (individuals and businesses) that open an account. Some existing members will also be requested to declare their tax residency when making any changes to their personal information.

Member and account details of foreign tax residents and U.S. Persons will be reported to the CRA.

How can I get more information?