Exchange of tax information becomes mainstream.

25.04.2014

On the 25^th of April, 2014 official gazette of Hong Kong published an order for the implementation of the Agreement with USA on the exchange of tax information as a matter of preparation for the enforcement of FATCA

The Agreement is the first for Hong Kong despite the on-going negotiations in this sphere with other countries. Exchange of the information with IRS is the main subject of the Agreement. Information includes data, which could be useful for determination, evaluation and collection of taxes, assessment and enforcement of the tax matters, and also for the compliance and criminal proceedings.

The Agreement is expected to enter into force after the ratification procedure that is scheduled for the 30^th of April.

FATCA is entering into force since the 1^st of July, 2014.

The text of the Agreement may be found here: http://www.ird.gov.hk/eng/pdf/Agreement_US_HongKong.pdf

Source: http://www.ird.gov.hk/eng/ppr/archives/14042502.htm

Expert’s opinion

FATCA requires U.S. citizens to declare their accounts in other jurisdictions. It is also requires financial institutions to disclose information about American clients.

Therefore, this Agreement matters, in first place, to the tax residents of the United States

Yaroslaw Lomakin ( Managing Partner, Honest&Bright)