The Foreign Account Tax Compliance Act (FATCA) is US legislation designed to prevent offshore tax evasion by US Persons.
FATCA imposes new requirements on financial institutions for identification, reporting and withholding. To comply with FATCA, ING is required to classify all of its customers – both entities and individuals – and in some cases to collect additional documentation.
The IRS has introduced a 30% withholding tax penalty that will be imposed on certain payments made to non-compliant entities and individuals.
ING will comply with FATCA in all countries where it is allowed or compulsory with the objective of obtaining the ‘participating’ financial institution status everywhere this is possible. ING is therefore proactively taking all relevant measures in order to be FATCA compliant by 1 July 2014 while continuing to best serving its clients and counterparties.