Germany: Updated FATCA guidance

FATCA Newsletter 02/2022

10 January 2023

Germany’s federal central tax office (BZSt) released FATCA-related guidance (FATCA Newsletter 02/2022) with the following updated information:

Internal Revenue Service (IRS) guidance on accounts with missing U.S. tax identification number (TIN): The IRS plans to issue guidelines outlining the process to be followed by financial institutions (FIs) in which the FI will not be deemed significantly noncompliant if a U.S. TIN is not reported for a particular account. This is provided in light of general problems that arise in obtaining a valid U.S. TIN from account holders, particularly “Accidental Americans.” FIs are requested not to terminate such accounts holders, especially “Accidental Americans,” for precautionary reasons when a valid U.S. TIN could not be reported for the respective reportable person. Any further updates issued by the IRS regarding the matter will be published on the BZSt website and through a FATCA newsletter.
Requirement of TIN while opening an account: According to “III. New Individual Accounts, A. Accounts Not Required to Be Reviewed, Identified or Reported.” of Annex I to the FATCA Agreement, FIs are not required to identify accounts as reportable accounts when the balance does not exceed U.S. $50,000 at the end of a calendar year. In such cases, obtaining a U.S. TIN from U.S. account holders should not be a requirement when opening an account if there is no obligation to report this account under the FATCA Agreement. In addition, failure to provide a valid U.S. TIN must not lead to the rejection of a basic account in these cases, since there could be a violation of Article 16 of the Payment Accounts Directive (PAD). FIs are thereby advised to refrain from further verification, identification, and reporting of accounts in the cases regulated under Section 5 Paragraph 3 FATCA-USA-UmsV.

Read a January 2023 report [PDF 220 KB] prepared by the KPMG member firm in Germany

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