The UAE has signed a deal to implement the Foreign Account Tax Compliance Act (Fatca).
The law requires foreign financial institutions to provide annual reports on account information of customers who are US citizens. The act was enacted by the US Congress in 2010 to target non-compliance by US taxpayers using foreign accounts.
Younis Haji Al Khoori, undersecretary of the Ministry of Finance, and Barbara Leaf, the US ambassador to the UAE, signed the agreement at the Ministry’s premises in Abu Dhabi.
“The country was keen to sign this agreement to protect UAE financial institutions,” said Mr Al Khoori. “In the case of non-compliance with the requirements of Fatca, any non-US financial organisation could face a 30 per cent penalty on certain financial returns of its operations in the US market.”
Under the intergovernmental agreement, the first report, for 2014, must be submitted to the United States by September 30. The agreement exempts certain government institutions, sovereign funds and international organisations from the reporting requirements.
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