A brief overview of FATCA and CRS
FATCA
Foreign Account Tax Compliance Act
What is FATCA?
FATCA was introduced by the United States’ Department of Treasury and Internal Revenue Service (IRS) in 2010 and is designed to encourage better tax compliance by preventing US persons from using banks and other financial institutions to evade taxation on their overseas income and assets.
South Africa signed an intergovernmental agreement (IGA) with the United States of America in 2014.
In order for Nedbank Group to remain compliant with FATCA, the Nedbank subsidiaries must provide all the relevant data required to comply with this legislation to their respective tax authority because they form part of the “expanded affiliated group” called Nedbank Group.
FATCA was introduced by the United States’ Department of Treasury and Internal Revenue Service (IRS) in 2010 and is designed to encourage better tax compliance by preventing US persons from using banks and other financial institutions to evade taxation on their overseas income and assets.
South Africa signed an intergovernmental agreement (IGA) with the United States of America in 2014.
In order for Nedbank Group to remain compliant with FATCA, the Nedbank subsidiaries must provide all the relevant data required to comply with this legislation to their respective tax authority because they form part of the “expanded affiliated group” called Nedbank Group.
CRS
Common Reporting Standards
What is CRS?
CRS is part of a global standard proposed by the Organisation of Economic Cooperation and Development (OECD) in 2014. Countries around the world came together and agreed to exchange tax information in an effort to prevent individuals and entities from using banks and other financial institutions to evade taxation on their income and assets.
The following SADEC countries are signatories to this agreement: Namibia, Lesotho, Eswatini, Botswana and South Africa.
CRS is part of a global standard proposed by the Organisation of Economic Cooperation and Development (OECD) in 2014. Countries around the world came together and agreed to exchange tax information in an effort to prevent individuals and entities from using banks and other financial institutions to evade taxation on their income and assets.
The following SADEC countries are signatories to this agreement: Namibia, Lesotho, Eswatini, Botswana and South Africa.
How does this impact Nedbank and our clients?
Our clients are directly impacted because they need to provide the required information in order to be FATCA- and CRS-compliant.
Nedbank is also required to ensure that all our clients are FATCA- and CRS-compliant and must obtain the required FATCA- and CRS-relevant information from all our clients. This is required for all individual clients as well as entity clients.
Nedbank is required under law to report all reportable accounts to the South African Revenue Service (SARS) to ensure we are compliant under the FATCA- and CRS- requirements.
Once reported to SARS, SARS may then share that information with the tax authority(ies) where the account holder has tax obligations, tax liabilities or tax residencies.
How does this impact Nedbank and our clients?
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Our clients are directly impacted because they need to provide the required information in order to be FATCA- and CRS-compliant.
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Nedbank is also required to ensure that all our clients are FATCA- and CRS-compliant and must obtain the required FATCA- and CRS-relevant information from all our clients. This is required for all individual clients as well as entity clients.
-
Nedbank is required under law to report all reportable accounts to the South African Revenue Service (SARS) to ensure we are compliant under the FATCA- and CRS- requirements.
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Once reported to SARS, SARS may then share that information with the tax authority(ies) where the account holder has tax obligations, tax liabilities or tax residencies.
We, as Nedbank, will request information or documentation from you in the following circumstances:
- As part of the onboarding (account opening) process if you are a new client.
- If you are an existing client of Nedbank for whom we do not hold the necessary information.
- If you are an existing client and there is a change of circumstance on your account(s), which may indicate a change in your status for FATCA and CRS reporting purposes.
Essentially, a change in circumstance refers to any change that results in the addition or alteration of client information or changes to controlling person information linked to that client.
- If you have closed your account during the current year, Nedbank will still be required to confirm whether your account is reportable for FATCA and CRS purposes and its details need to be included in Nedbank’s FATCA and CRS submission to SARS for that period.
What we need from you as our client?
- Provide the FATCA and CRS information and/or documentation, as requested, when you open a new account, or when visiting a branch. Your Relationship manager may also contact you.
- Please respond to our communications when we request you to provide certain information or IRS W-forms.
Note: Some of the IRS W- forms expire after three years and new forms must be completed, dated and signed.
- Advise us when there is a change in your circumstances, eg a change of address.
The importance of self-certification
Nedbank will ask you to confirm your FATCA- and CRS-status through the completion of a self-certification form and a IRS W-form where applicable.
Some clients may have to complete a form for each relationship type. In other words, some clients will self-certify in:
- their individual capacity;
- their capacity as a controlling person, eg a guardian of a minor’s account; or
- as a controlling person of a legal entity, eg a trustee of a trust, share holder of a company.
Please note: If you do not self-certify, we are required under the legislation to restrict your account and report your non-compliance to the South African Revenue Service (SARS) who may take further action.
How will Nedbank assist our clients?
We wish to assure our clients of our continued service and support. Should you have any questions, please contact your Relationship manager or visit a branch.
Alternatively, you can phone our dedicated contact centre from 08:00 until 17:00 (Monday to Friday):
- Nedbank Retail Call Centre at 0860 774 828 or email us at FATCACRSQuerySupport@Nedbank.co.za
- Nedbank Private Wealth at 0860 111 263 or email us at contact@nedbankprivatewealth.co.za
- Nedbank Insurance at 0860 333 111
Please note: Nedbank is required by law to obtain the required information and/or documentation from our clients. We will try to assist you, although Nedbank employees are not tax advisors and will not be able to provide tax advice. For this you may wish to consult an independent tax advisor.
Where to find the IRS-forms if you are impacted by FATCA?
IRS W-8BEN-E
This form is used by entities only where the client has US indicators.
For instructions on how to complete this form click here.
Download form
IRS W-8BEN
This form is used by individuals only where the client has US indicators.
For instructions on how to complete this form click here.
Download form
IRS W-9
This form is used for BOTH individuals and entities that are US persons, being US citizens (including resident aliens) or US entities.
For instructions on how to complete this form click here.
Download form
IRS W-8ECI
This form is used for individuals that are not US citizens, but earn income from the US through the conduct of a trade or business.
For instructions on how to complete this form click here.
Download form
Further information
