One buzzin’ Brocker, Bubblebustin, doesn’t give up easily. Here’s the report I got by email.
There’s been a small development on the Canadian Bankers Association front that came about from a series of letters I initiated between Ms Drew-Lytle, their Director of Media Relations and Communications, and myself.
Brockers may remember Ms Drew-Lytle when she communicated with us here: http://isaacbrocksociety.ca/2012/07/16/canadian-bankers-association-maura-drew-lytle-responds-to-the-isaac-brock-society/.
I persuaded her to revise the CBA’s FATCA consumer info page (http://www.cba.ca/en/consumer-information/40-banking-basics/597-fatca-and-the-canada-us-intergovernmental-agreement-iga-information-for-clients-) to better reflect the options available to a Canadian banking customer should they fail to be in possession of a CLN or other documentation that might prove they are no longer a US citizen, OR, never were one.
My intention was to have the CBA include a direct reference to a “reasonable explanation” in their answer to FAQ “How do banks determine which accounts have to reported to the CRA?”, provided in the “Guidance on enhanced financial accounts reporting” (http://www.cra-arc.gc.ca/tx/nnrsdnts/nhncdrprtng/gdnc-eng.pdf). Instead, she provided a link to the guidance itself and agreed to change the wording on their answer to no longer deny the possibility of a “reasonable explanation” in all cases. Her reason for doing so, she said, was so the CBA wouldn’t have to revise its info page should the IGA change.
I also hoped the CBA would take the important initiative in providing our banks with guidance to determine what a “reasonable explanation” is (instead of leaving it up to individual bank employees to decide) but she said that’s the CRA’s job, not theirs.
The old wording on up the CBA’s website read:
Canadian Bankers Association
How do banks determine which accounts have to be reported to the CRA?
Under the IGA, banks are required to review new and existing client accounts to look for any indication that an individual may be considered a U.S. person. Indicators that someone may be a U.S. person include U.S. identification used to open an account or a U.S. address associated with the account. Your financial institution may ask you to self-certify that you are not a U.S. person by providing additional documentation. If you choose not to provide this additional documentation upon request, your financial institution will be required to send your account information to the CRA which may share it with the IRS.
For more information on financial institution requirements under the IGA, visit the CRA website:
http://www.cra-arc.gc.ca/tx/nnrsdnts/nhncdrprtn
The new wording is:
How do banks determine which accounts have to be reported to the CRA?
Under the IGA, banks are required to review new and existing client accounts to look for any indication that an individual may be considered a U.S. person. Indicators that someone may be a U.S. person include U.S. identification used to open an account or a U.S. address associated with the account. Your financial institution may ask you to self-certify that you are not a U.S. person by providing additional documentation. Depending on the situation, if this additional documentation is not provided, your financial institution may be required to send your account information to the CRA which may share it with the IRS.
For more information on financial institution requirements under the IGA, visit the CRA website:
http://www.cra-arc.gc.ca/tx/nnrsdnts/nhncdrprtng/ndvdls-eng.html
http://www.cra-arc.gc.ca/tx/nnrsdnts/nhncdrprtng/gdnc-eng.pdf
‘One thing leads to another’
JC Double Taxed @JCDoubleTaxed 23s24 seconds ago
@CdnBankers Which bank will support http://www.adcs-adsc.ca/ Lawsuit protecting Canada fr. US Extraterritorial Laws? https://twitter.com/JCDoubleTaxed/status/624014732345741312
@bubblebustin;
Thank you for using your persistent buzz to press the CBA.
I still despise their behind the scenes double dealing and self serving machinations to get the arrangement that they thought best served THEMSELVES regardless of their accountholders – who after all are the true owners of the assets.
But for those who can’t move to one of the credit unions
http://maplesandbox.ca/2014/are-other-canadian-credit-unions-being-as-responsible-about-fatca-as-vancity/
This link is very useful to explain the situation with credit unions:
http://www.bdo.ca/en/Library/Services/Tax/pages/Tax-Alert-FATCA-and-Canadian-Credit-Unions.aspx linked from IBS here http://isaacbrocksociety.ca/2015/04/13/fatca-and-credit-unions/
Read in entirety:
“Credit Unions
Generally, Canadian credit unions are considered Canadian Financial Institutions under the IGA. There are however, three general exceptions that may be applicable and that would allow a Canadian credit union to be considered a non-reporting Canadian Financial Institution. If a credit union can meet the requirements of one of these exceptions, its obligations under FACTA will be much less stringent. These three exceptions are:
the Local Bank exception
the Local Client Base exception, and
the Low Value Account exception.
There is also a specific exception for a Central Cooperative Credit Society (CCCS). However, as a CCSS primarily provides support to, and services for, member credit unions, it will have limited applicability.
1. Local Bank Exception
The Local Bank exception is available if all of the following requirements are met:
The credit union is licensed and regulated under the laws of Canada as a credit union or similar cooperative credit organization that is operated without profit.
No member has a greater than 5% interest in the credit union or Cooperative Credit organization.
The credit union does not have a fixed place of business outside Canada.
The credit union does not solicit customers outside of Canada.
The credit union does not have more than U.S. $175 million in assets on its balance sheet.
Any related entities, taken together, do not have assets exceeding U.S. $500 million collectively; and
Any related entity is incorporated or organized in Canada, and all related entities also meet all of the above requirements.
2. Local Client Base Exception
The Local Client Base exception is available if all of the following requirements are met:
The credit union is licensed and regulated under the laws of Canada.
The credit union does not have a fixed place of business outside of Canada.
The credit union does not solicit customers outside of Canada.
The credit union is required under Canadian law to identify Canadian resident account holders to perform information reporting or is a reporting entity under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) and related regulations.
At least 98% of the financial accounts by value provided by the credit union are residents of Canada, and
The credit union has policies and procedures to identify any financial account held by a specified U.S. person who is not a resident of Canada, and monitors whether it provides accounts to any specified U.S. persons who are not a resident of Canada.
3. Low-Value Accounts Exception
The Low-Value Accounts exception is available if all of the following requirements are met:
The credit union is not an “investment entity”. An Investment entity, as defined in the IGA, primarily conducts as a business (or is managed by an entity that primarily conducts as a business) one or more of the following activities for, or on behalf of, a customer:
a) trading in money market instruments (such as cheques, bills, certificates of deposit, and derivatives), foreign exchange, exchange, interest rate, and index instruments, transferable securities and commodity futures;
b) individual and collective portfolio management; and
c) otherwise investing, administering or managing funds or money on behalf of other persons.
No account maintained by the credit union has a balance or value in the aggregate exceeding U.S. $50,000, and
The credit union does not have more than U.S. $50 million in assets on its balance sheet as of the end of the preceding accounting year.
Any related entities, taken together, do not have more than U.S. $50 million in total assets on their balance sheets as of the end of the preceding accounting year. ..”…………….
Please note even if you use your birth certificate at bank according to Canadian FATCA unless the birth certificate says USA you are safe
“8.28 In the context of an electronic record search, an “unambiguous indication of a U.S. place of birth” must include identification of the U.S. as the country of birth. Identification of a city and/or a state as the place of birth, without identification of the country of birth as the U.S., is not considered to be unambiguous.
http://www.cra-arc.gc.ca/tx/nnrsdnts/nhncdrprtng/gdnc-eng.html#Toc390079642
New York, New York”
Detroit, Michigan
Los Angles California
are ambiguous can not be consider US place of Birth
You do not need place of birth for banks anyway
“7. Will my financial institution ask me if I was born in the U.S.?
A financial institution does not have to ask its account holders about their place of birth.
If a financial institution, applying the due diligence rules of the agreement to its accounts, finds records that have an unambiguous indication of a U.S. place of birth, the financial institution must treat the account as a reportable account or follow up with the account holder to obtain documentation that shows he or she is not a U.S. resident or a U.S. citizen.”
http://www.cra-arc.gc.ca/tx/nnrsdnts/nhncdrprtng/fq-eng.html#q2-5
I do not know about other countries
@news
“If a financial institution, applying the due diligence rules of the agreement to its accounts, finds records that have an unambiguous indication of a U.S. place of birth, the financial institution must treat the account as a reportable account or follow up with the account holder to obtain documentation that shows he or she is not a U.S. resident or a U.S. citizen.”
http://www.cra-arc.gc.ca/tx/nnrsdnts/nhncdrprtng/fq-eng.html#q2-5
I do not know about other countries”
Sounds as though the CRA website Q & A also needs some updating to include “reasonable explanation”, as stated in http://www.cra-arc.gc.ca/tx/nnrsdnts/nhncdrprtng/gdnc-eng.pdf
Unambiguous U.S. place of birth
8.27 When the indicium found is an unambiguous indication of a U.S. place of
birth, the account must be reported unless the financial institution obtains
or currently maintains a record of all of the following:
a self-certification showing that the account holder is neither a U.S.
resident nor a U.S. citizen;
evidence of the account holder¹s citizenship in a country other than the
U.S. (for example, a passport or other government-issued identification);
and
a copy of the account holder¹s Certificate of Loss of Nationality of the
United States or a reasonable explanation of why:
the account holder does not have such a certificate; or
the account holder did not obtain U.S. citizenship at birth.
Getting this right is going to become very important at the point when banks start asking their customers to come in to verify their status. Banking customers will be looking to our traitorous government for guidance, which is proving itself to be inept at conveying its own guidance. They have no clue what they’re about to unleash here.
@ Bubblebustin
Thank you for your persistence … good buzzing!
Buttlebustin
Sounds as though the CRA website Q & A also needs some updating to include “reasonable explanation”, as stated in http://www.cra-arc.gc.ca/tx/nnrsdnts/nhncdrprtng/gdnc-eng.pdf
8:27 from website guidance is exactly same as pdf
Unambiguous U.S. place of birth
8.27 When the indicium found is an unambiguous indication of a U.S. place of birth, the account must be reported unless the financial institution obtains or currently maintains a record of all of the following:
a self-certification showing that the account holder is neither a U.S. resident nor a U.S. citizen;
evidence of the account holder’s citizenship in a country other than the U.S. (for example, a passport or other government-issued identification); and
a copy of the account holder’s Certificate of Loss of Nationality of the United States or a reasonable explanation of why:
the account holder does not have such a certificate; or
the account holder did not obtain U.S. citizenship at birth.
http://www.cra-arc.gc.ca/tx/nnrsdnts/nhncdrprtng/gdnc-eng.html#Toc390079642
The first quote you used is from frequently question which is only 8 pages long. Unlike 160 long guidance. Documentation would include your stating you did not obtain US citizenship at birth. The bank should ask you the question “a reasonable explanation of why:
the account holder does not have such a certificate; or
the account holder did not obtain U.S. citizenship at birth”
If you want to believe ten of millions of single citizen Canada should suffer when US apply the 30% withholding you may not understand why Kal Tire tire company ran ads insulting American as arrogant during the Stanley Cup playoff.
https://www.kaltire.com/3-season-tires/
Even the vast majority of dual citizen will not be caught. If you are caught you can renounce and you do not have to be tax compliant, unlike the original European FATCA.
Of course maybe you can explain why the Liberal party in 1995 broke the revenue rule or why all western developed countries have signed off to FATCA. Even Putin signed off.
revenue rule
“Expatriation: The American’s Tax Experience in Canada
Kevyn Nightingale and David Turchen*
page 35 & 36
The reverse is not true. Under Canadian common law (and in most common-law jurisdictions), Canada will not act to collect a foreign nation’s tax:
[E]nforcement of a claim for taxes is but an extension of the sovereign power which imposed the taxes, and . . . an assertion of sovereign authority by one State within the territory of another . . . is (treaty or convention apart) contrary to all concepts of independent sovereignties.220
This convention is called “the revenue rule.”221″
Effective November 8, 1995, the Canada-US treaty was amended to override the revenue rule and provide for each government to assist in the collection of taxes owing to the other government. For the CRA to accede to a request by the IRS in respect of US taxes owing by an individual,
n the taxes must be “finally determined” (not subject to further rights of appeal), and
n the individual cannot have been a citizen of Canada during the period in which the tax debt was incurred.”
Even Trudeau was alive and active during this time.