Under the US Foreign Account Tax Compliance Act (known as FATCA) Australian banks have provided details of over 30,000 customer accounts worth over $5 billion to the US Internal Revenue Service (IRS – the US equivalent of our Tax Office).
These are accounts of US citizens and tax residents with Australian bank accounts. There is a wave of transparency measures being implemented world-wide. By 2017 close to 100 countries will be sharing non-resident data under the OECD Common Reporting Standard.
The Australian Tax Office will receive data from the IRS about Australians with financial accounts in the US and will use that data to detect cases of undeclared offshore income and tax evasion.
These arrangements are the new international standard to eliminate tax evasion and the Tax Office is intending to comply fully on the basis that these initiatives will further strengthen Australia’s existing network of international treaties and information exchange agreements. During 2014/15 there were 519 exchanges of information resulting in additional tax revenue of $255m.
Andrew and Tony Lovett
22 February 2016
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