Bankers Association of Saint Lucia announces compliance with FATCA

Bankers Association of Saint Lucia

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PRESS RELEASE – For the last few years financial institutions have been preparing for the new reporting requirements for United States clients which form part of the Foreign Account Tax Compliance Act (FATCA).

The act is intended to increase transparency for the Internal Revenue Service (IRS) with respect to U.S. persons that may be investing and earning income through non-U.S. institutions.

As of July 1st 2014 financial institutions in Saint Lucia and the rest of the Eastern Caribbean Currency Union (ECCU) member countries, now classed as Foreign Financial Institutions or FFIs, are required to adopt new account opening procedures in order to comply with FATCA rules.

The Bankers Association of Saint Lucia (BASL) announced that local FFIs have for several months been preparing and training employees for the changes and Saint Lucia’s finance sector is ready to comply by the deadline date. Individual institutions have also issued notifications and information about the new rules to customers.

The BASL understands, however, that educating the public will be an ongoing exercise and encourages all financial institutions to ensure that employees and clients understand the new regulations and also encourages the public to comply and be co-operative during the process.

The Association noted that the ECCU Member Governments have adopted the IGA Model 1 which requires financial institutions to submit all FATCA-related information to their respective Inland Revenue Department for onward submission to the IRS.

According to FATCA, financial institutions must provide all information on assets of US$50,000 or more held by U.S. taxpayers, or by foreign entities in which U.S. taxpayers hold substantial ownership interest.

Failure of an FFI to submit information could result in a 30 percent withholding tax levied on withholdable payments and may result in the potential loss of critical correspondent banking relationships and this would affect customers’ ability to transact with the USA, our main trading partner.

The services that would be cost affected would be wire transfers, drafts and other payment mechanisms if banks can no longer clear these transactions through U.S. banks.

The BASL reminds the public that FATCA does not replace the existing U.S. tax withholding and reporting regimes. It does, however, add additional requirements and complexity to the existing regimes. The IRS expressed its intent to eliminate duplicative reporting and withholdings where possible.

The attributes which cause an individual or business to be classified as a U.S. person include: U.S. citizenship; Being a lawful resident of the U.S. and/or; U.S. corporations, U.S. partnerships/ U.S. estates/ U.S. trusts where the U.S. exercises primary supervision over administration or where one or more U.S. persons has the authority to control all substantial decisions.

The Association notes that the impact of FATCA is far reaching and impacts any person, U.S. or foreign, to the extent that such person is involved in making or receiving payments that fall within the scope of FATCA.

The Bankers Association of Saint Lucia reiterates the commitment of Saint Lucia’s financial institutions to ensuring regional compliance with FATCA and calls on the public to assist financial partners in that regard. The BASL encourages all clients and prospective clients to visit or call their respective branches for further clarity or details on this issue if they are affected by this new US legislation.

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9 comments

  1. Write more, thats all I have to say. Literally, it seems as though you relied on the video to make your point. You obviously know what youre talking about, why throw away your intelligence on just posting videos to your site when you could be giving us something enlightening to read? fekekgebefadddbf

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  2. I wonder weather or not our Heads of state are giving true repesentation to its people. After all we hear of OECS Unity, Caricom Government etc. Are they truely our representatives when thay attend meeting with the powers that be in the US.
    Why are we allowing US government to find every reason to shove things down our throat and then sit by and accept it all.

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  3. I suspect these IRS and all those Banking Institutions are Encouraging more Borbol. If we resort to the under the Mattress Banking Institution like our great Great grand parents did, then they will call it money laundring.

    I may have to withdraw and place my money at the credit union for a start. May be it will eventually get to the credit union. At this point I will resort to the Under the Mattress Banking Instituion

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    • The reality is that the Credit Unions fall under the same FATCA Model....

      Maybe the Credit Union League should send a press release and I think it is absolutely necessary that they do.

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  4. This is the most corrupt association in St. Lucia while the boast of meeting compliance standard. How are they helping the government in regulating the economy. Instead there is a new charge for everything while they use customer dollars to make millions. Worst yet they encourage the banks to have their lawyers represent the customers. Conflict of interest. Our laws are Good enough to protect everybody's interest as fitting so the banks don't need to give us lip service.

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  5. People who are affected should withdrew the funds from these institutions and find alternative ways of saving. Majority of people with bank accounts in their home land that are American citizens or residents has already paid their income taxes from the gross income before receiving their checks what more does IRS want from them? Our crocked governing bodies need to work to find ways to become self sufficient to stop relying on foreign governments to dictate to them what they must do in order to breath. I see this as a disadvantage to the home land. Because most people will choose to close account in their home land and will not have the flow of foreign currency that would help them compete a little easier in the global community.

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  6. Manipulation at the highest by the USA.

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  7. Again we bow down.

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