AIC advises members to take a hit on FATCA


The Association of Investment Companies (AIC) is advising members with modest investments in US securities to avoid signing up to FATCA, in the same week as the IMA called for a further delay to the deadline.

FATCA, or the Foreign Account Tax Compliance Act, is a set of measures designed to fight offshore tax evasion by US citizens. It will be a significant cost and administrative burden for financial institutions and investment companies. For companies which do not derive a significant proportion of their revenues from the US and have few US investors, the cost of complying outweighs the 30% withholding penalty, the AIC said. Any investment company with US investments will need to split payments into two streams, to show how much income has been generated from the US. Under the proposa...

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