Under the Taxation Administration Act (1953), NAB is required to ask customers about their tax details. NAB will ask you questions about your local and overseas tax obligations.
Foreign Account Tax Compliance Act
The Foreign Account Tax Compliance Act (FATCA) is legislation aimed at preventing tax evasion by U.S. persons (individuals and entities. All non - U.S. Financial Institutions (FFIs) are required to identify and report financial accounts held by U.S. citizens or U.S. residents to the U.S. Internal Revenue Service (IRS).
Many countries, including Australia, have entered into inter-governmental agreements (IGA) with the U.S., to enable FFIs in these jurisdictions to comply with FATCA under their local legislation, thus leveraging and improving existing tax information sharing arrangements between the IRS and the relevant local tax authorities. The obligation on NAB to adhere to FATCA in Australia is driven by the Australia- U.S. IGA, and the supporting Australian legislation.
Common Reporting Standard
The Common Reporting Standard (CRS) is an international initiative involving over 100 countries to the exchange of information on accounts held by non-resident individuals and entities with the tax authorities in their respective countries of tax residency.
To comply with CRS, banks and other financial institutions are required to collect foreign tax residency information from their customers. The aim of this legislation is to promote a reduction in offshore tax evasion. All participating countries, which includes Australia, are required to identify and report foreign account holding information to their local tax authority which will be disclosed to the relevant foreign tax authorities.
All NAB customers (individuals, business, trust, etc.) are subject to this legislation.
What is the difference between the information NAB collects for FATCA and CRS?
FATCA requires NAB to ask you if you are a U.S. citizen or a U.S. tax resident. CRS requires NAB to ask you about your foreign tax residency.
What is tax residency?
Foreign tax residency is determined by the rules of each participating country’s taxation laws. It is important that your tax residency information is correct, complete and not misleading.
This includes, ensuring you advise NAB within 30 days of any change in circumstances that affects your tax residency status and to provide NAB with an updated self certification within 30 days of such change in circumstances.
Under local legislation, severe penalties may apply for providing false or misleading information.
For more information, we suggest you contact your tax adviser or refer to the ATO website (link below).
What are the key requirements of NAB?
- All new customers will be required to provide information about their tax residence when applying to open an account.
- Existing NAB customers may be required to provide information about their tax residence when requested by us.
Who does NAB report foreign tax details to?
Customers who are foreign tax residents may be reported to ATO on an annual basis.
Where can you find more information about CRS?
More information on CRS can be found on the below sites: