FATCA agreement can block millions of Polish accounts and accounts
Many Poles may cause blocking of accounts and bills. And all because at the beginning of December 2015. Poland will begin to implement the so-called. FATCA agreement, or an agreement with the United States, which is to counteract the concealment of income.
As for the transmission of data for Ocean holders of bank accounts, brokerage, TFI register or investment policies that are US tax residents, that people should pay taxes there.
Who may have trouble
─Ta law generally assumed to customers of a financial institution that will have to submit a statement in which they will have to indicate if there are so-called. Americana features – explains Tadeusz Proteins with the Polish Bank Association. As he says, it is a concept somewhat broader than just nationality. That also applies to people, even with a green card, or people staying longer in the United States. But also, and those who have given phone number in the US, and address. In practice, financial institutions and companies will have to ask their customers whether they have any connection with the United States.
After December 1, 2015, new customers will simply have to fill in a declaration attached to the agreement.
The situation is different with contracts already in force. Here, for all the people who founded the bills after July 1, 2014. The date of entry of the Act, ie until 1 December 2015. It will have to be sent to a statement of the US tax residency or lack thereof.
Note: statement under pain of penalty
What’s important clients of financial institutions and companies will be submitted under penalty of criminal prosecution.
With estimates of the Polish Banks Association it shows that such people are at least a hundred thousand, but these are very conservative estimates. In practice it may concern million accounts. The accounts established at that time (July 1 2014-1 December 2015) hit for a transitional period in which FATCA should apply in Poland, but due to delay legislation, has not entered into force. Now the authorities have one year to verify all accounts. If their owners inquiry ignore and fail to respond, then in accordance with the banks, brokerage houses and other entities will be obliged to block such bills -ostrzega Peter Sobków, a board member of the Chamber of Brokerage Houses. ─ Unfortunately, if we do not receive a statement to the end of November next year from the client, then in accordance with the provisions we have a duty to block the bill. And then, as long as the client does not send us such a statement will not be able to use at all of its resources.
The problem applies to accounts in brokerage houses
And that can be particularly problematic and painful for brokerage clients who have accounts there. For there are such operations as performance rights, which if you do not perform, then lost funds. Similarly, in the case of derivatives, at which if the right moment does not close the position, the client bears the heavy losses – explains Piotr Sobków. So in this situation it can be a huge issue for both customers and themselves brokerage houses. Here, however, the rules say clearly, the bill must be blocked until the customer does not make a declaration about the US tax residency or lack thereof.
FATCA agreement would be costly for financial institutions
meet commitments associated with the Polish-American agreement, FATCA, it’s also enormous costs for the financial institutions themselves. -It Requires a change in systems and colloquially speaking, sewing these statements in banking procedures and is of a general nature, because basically applies to all customers – adds Tadeusz Proteins of the PBA. For the banks are multimillion-dollar costs. Of course, will depend on the scale of operations, for smaller institutions, such as cooperative banks are partly exempt from these duties. The largest costs relate to commercial banks, which must fully implement the regulation. If they do not, they risk serious sanctions, for example. Withholding tax on income from US sources.