Foreign Account Tax Compliance Act (FATCA)
1. What is FATCA?The Foreign Account Tax Compliance Act (FATCA) is a law that was passed in the United States. U.S. Persons are taxed on their worldwide income regardless of where they live. FATCA aims to combat U.S. tax evasion by U.S. Persons with financial assets outside the U.S. Therefore, FATCA is meant to encourage proper reporting of all investment income and all dispositions of securities by a U.S. person no matter where in the world the investment is held. Beginning July 1, 2014, non-U.S. financial institutions are required to identify, document and report on accounts held by U.S. Persons. To learn more about FATCA, visit the Canada Revenue Agency’s website.
2. What is the impact of FATCA?As per FATCA regulations, certain financial accounts held by U.S Persons must be identified and reported by Financial Institutions to Tax Authorities.
3. Is BMO FATCA compliant?BMO Financial Group is complying with local legislation regarding the implementation of FATCA.
4. Who does FATCA impact?FATCA is primarily focused on U.S. Persons (individual or entity). The impact could vary:
- If you are an individual accountholder (including sole proprietorships or an entity);
- If you have an existing financial account or you are opening a new account
5. Who is considered a U.S. Person?Generally, a U.S. Person is someone who is:
- a Citizen of the U.S. including
- individuals who hold U.S. citizenship but reside in another country who has not renounced their U.S. citizenship
- a Resident of the U.S.
- including U.S. green card holders
- a non-exempt U.S. Corporation, U.S. Partnership, U.S. Estate or U.S. Trust
- a person who spends considerable time in the U.S. in one year or over a period of years. For further information regarding your status as a U.S. Person, consult the IRS website or a tax advisor.
6. If I have a U.S.-dollar account in Canada or the U.S., does this classify me as a U.S. Person?The account holder's information such as address or place of birth is used to determine their status as a U.S. Person, not the account type.
7. If I have dual-citizenship with the U.S., am I considered a U.S. Person?Yes. Please refer to the "Who is considered a U.S. person?" For a full criteria of U.S. Persons, please review the following:
8. If I am a Snowbird am I considered a U.S. Person?If you spend a substantial time in the U.S. over the course of a year or several years, you may be considered a U.S. person. If you are unsure of your status as a U.S. Person, consult the IRS website or a tax advisor.
9. If a joint account is held by a U.S. Person and a non-U.S. Person, what will that mean for FATCA reporting?In order to determine the applicability of FATCA, BMO may require all joint account holders to submit additional documentation. The accountholder who is a U.S. Person will have their information and full account balance reported to the CRA.
10. I was born in the U.S., but have lived outside the U.S. my whole life. How does FATCA impact me?If you are born in the U.S. you may be considered a U.S. Person. If you are born in the U.S. and you have renounced your U.S. citizenship AND obtained a Certificate of Loss of Nationality from the United States Department of State, you are not considered a U.S. Person.
11. If BMO believes I am a U.S. Person, what documentation do I need to provide to BMO to advise I have renounced by U.S. Citizenship?In order to verify that you renounced your U.S. citizenship, you should submit all of the following documents:
- a self-certification form (or W-8 BEN form) which demonstrate that the client is neither a U.S. resident for tax purposes nor a U.S. citizen; AND
- evidence of the client's citizenship in a country other than the U.S. (i.e. passport or other government-issued identification); AND
- a copy of the client's Certificate of Loss of Nationality of the United States
12. Can BMO advise me on how FATCA affects me?BMO employees are not able to provide any legal or regulatory advice regarding FATCA. If you are seeking further information on how FATCA impacts you or your family, please consult a tax or legal advisor.
13. As a personal account holder, what information do I need to provide to BMO?In order to verify an individual's status for FATCA purposes, you may be asked to provide additional documentation such as government-issued identification, and/or complete one of the following forms:
- IRS Tax forms: W-8BEN, W-8BEN-E, W-8IMY, W-8EXP, W-9 or
- BMO FATCA self-certification document
14. When will an account be reportable?Accounts may be reportable under the following circumstances:
- If an account is held or controlled by one or more U.S. Persons (inclusive of joint accounts held by at least one U.S. Person) and entities (specified U.S. Entities)
- An account is held by a client who failed to comply with BMO's request for additional information or documentation within the requested time frame
15. What information about U.S. Persons (that are Individuals) will be reported to the CRA?In 2015, the CRA will require all Canadian Financial Institutions to begin FATCA reporting. For accounts identified in 2014, this may include:
- Account Holder’s Name
- U.S. TIN (Taxpayer Identification Number) or Date of Birth
- SIN (Canada only)
- Account Number
- Market value of the account at year-end
16. Which financial accounts do the rules of FATCA cover?FATCA impacts most of the following financial accounts:
- Bank Accounts
- Mutual funds
- Brokerage accounts
- Custodial accounts
- Annuity accounts (including segregated fund contracts)
- Certain life insurance policies with a cash value
Registered Products that are exempt from FATCA includes
- Registered Retirement Savings Plan (RRSPs)
- Tax Free Savings Accounts (TFSAs)
- Registered Disability Savings Plans (RDSPs)
- Registered Pension Plans (RPPs)
- Registered Retirement Income Funds (RRIFs)
- Pooled Registered Pension Plans (PRPPs)
- Registered Education Savings Plans (RESPs)
- Agrilnvest Accounts
- Deferred Profit-Sharing Plans (DPSPs)
17. I am a business owner. Do I have to provide separate forms for myself and the business?BMO will contact the account holder to complete FATCA documentation if required.
18. As an individual, what should I do if my circumstances change after I submit the requested documentation?If there is a change in your status as a U.S Person, it is your responsibility to inform BMO as soon as possible.
19. If I am contacted about my U.S. Status, what is acceptable identification to comply with FATCA (for individuals)?Canadian residents may click on the link to view the acceptable documentation as identification to comply with FATCA:
20. What if I do not provide additional documentation that is requested of me within the specified timeframe?As per Part XVII of the Income Tax Act, if a client or U.S. Person does not respond to BMO's request for further information or documentation, we may be required to report certain information to the CRA.
21. As a U.S. Person, what are my tax reporting requirements?We recommend you contact a professional tax advisor to understand your U.S. tax reporting requirements.
22. Are spouses or children of U.S. Persons impacted by FATCA?Only U.S. Persons are impacted by the rules of FATCA. BMO will not assume that the spouse or children of a confirmed U.S. person are also U.S. Persons.
23. I closed my BMO accounts. Why am I being asked to complete forms?If your account was closed on or after July 1, 2014, and you were identified as a possible U.S. Person prior to closing your account; BMO has an obligation to properly document the account.
24. What is a TIN?The Internal Revenue Service (IRS) issues an identification number known as the Taxpayer Identification Number (TIN). Similar to the Canadian Social Insurance Number (SIN), it is used in the administration of tax laws. The Social Security Administration and the IRS can issue a TIN.
25. What is a GIIN (Global Identification Number) – only for business customers?The IRS issues a 19-character identification number when a non-U.S. Financial Institution registers for FATCA purposes. This is known as the Global Intermediary Identification Number (GIIN).
26. Where can I go for more information?Further information on FATCA can be accessed on