Welsh Scout troop told to fill in US tax form before it can open UK bank account
A Welsh Scout leader wanting to open a bank account was astonished when he was told he could only do so if he filled in a form for the United States tax authorities.
Darren Stockton, who has run a Scout troop in Usk for six years, approached his local branch of HSBC wanting to open a separate bank account for the new Explorer unit for 14-to-18 year-olds.
‘We’re not the 51st US state’
He said: “When they told me they could only open the new account if I filled in a form for the US Internal Revenue Service I thought ‘This can’t be right’. We’re not the 51st US state after all.
“But I was given exactly the same information when I got on to the NatWest. I was told by both banks that they were following new guidelines from HMRC [the UK’s tax body].
“It seems there has been some kind of deal between the US and UK Governments that allows the Americans to insist on a tax form being filled in by people opening non-personal accounts in the UK.
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“I’ve been on holiday to the United States four times but I don’t have any commercial interests there.
“We’re talking about a dozen young people paying subscriptions of £5 a month to a Scout troop in Monmouthshire. The situation is crazy.”
Obama initiative
A spokesman for HSBC said: “All financial services institutions operating in the UK must be compliant with the US Foreign Account Tax Compliance Act (FATCA), the purpose of which is report to the US authorities on the financial assets of US citizens.
“As part of ensuring compliance with FATCA, HSBC may ask some customers in the UK for additional information to confirm their tax status. Any customer with questions or concerns can either visit our website or a branch.”
FATCA is an initiative introduced by President Barack Obama designed to cut back on tax evasion by American citizens using foreign accounts.
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US taxpayers with foreign accounts that have an aggregate value in excess of $10,000 must report those accounts on a Report of Foreign Bank and Financial Accounts or “FBAR” form.
HSBC has told Mr Stockton he must fill one in.
MP left ‘amazed’
Monmouth MP David Davies said: “I am amazed that British citizens are being forced to fill out forms for the US revenue service.
“I could understand it if this was required for people involved with international commercial transactions as we all recognise a need to ensure that taxes are paid in full by companies operating across borders.
“However what possible reason could there be for a Scout leader setting up a bank account to comply with American tax laws?
“I have put all of this to the Treasury. I would also like to know whether Scout leaders in the US will be filling in forms for the Inland Revenue and if not why not.”
