ATCA is an anti-tax evasion law under which fund houses are required to report information on US investors to US IRS (Internal Revenue Service) through CBDT. India has agreed ‘in substance’ to FATCA by signing an Intergovernmental Agreement Model 1 (IGA-1) with US in effect from July 9, 2015. Simply put, the legislation is meant to prevent wealthy US individuals from parking money overseas to avoid paying taxes.
Registrar and transfer agents – CAMS, Karvy, Sundaram BNP Paribas Fund Services and Franklin Templeton have introduced online facility for distributors and investors to update The Foreign Account Tax Compliance Act (FATCA) information.
This streamlined process will make things much simpler. All you need to do is key in the PAN number of your client. The system will generate one time password (OTP) which is sent to client’s mobile number. After keying in OTP, you need to fill in the declaration form and submit it. This declaration form will capture information like type of address (residence, business, registered office etc.), country of tax residence, tax identification number, Global Intermediary Identification Number (GIIN) and seek investor’s consent for sharing the information with relevant tax authorities.
Distributors are expected to update the details of their existing foreign investors by adding this information.
While many fund houses had stopped accepting fresh investments from US investors due to stringent compliance requirements under FATCA, a few AMCs had asked their distributors who have clients from USA to furnish the documentary evidences of tax residency and other information.
Some officials say that US NRIs can potentially be a sizeable market for the Indian mutual fund industry. They believe the new online facility will help AMCs seek mandates from US entities to manage investments in India. FATCA guidelines came into effect with November 1, 2015. Here are the links ;
Sundaram Bnp Paribas Fund Services http://tinyurl.com/pkwdo7c
Franklin Templeton http://tinyurl.com/o52pzp2
Read more at: http://cafemutual.com/news/industry/4238-rts-introduce-online-fatca-updating-facility