Frequently asked questions about FATCA
  • FATCA stands for the Foreign Account Tax Compliance Act. It is a new piece of legislation to prevent tax evasion by US taxpayers in the US.

    Introduced by the United States Department of Treasury (Treasury) and the US Internal Revenue Service (IRS), the purpose of FATCA is to encourage better tax compliance by preventing US Persons (see glossary) from using banks and other financial organisations to avoid US taxation on their income and assets. 

    A significant number of countries and territories worldwide are expected to sign Inter-Governmental Agreements (IGAs) relating to FATCA compliance with the United States government. These IGAs will result in the FATCA legislation becoming part of these countries’ and territories’ local laws. (Please refer to glossary for IGA definition)
  • On an annual basis, banks and other financial organisations will be required to report information on financial accounts held directly or indirectly by US Persons.

    Hang Seng has made a commitment to being fully FATCA-compliant in all countries and territories where we operate. We will therefore be reviewing our existing customer base to confirm the FATCA status of our customers and where necessary we may need to engage our customers from time to time to help us understand them better including requiring customers to provide us with further information and documentation.
  • FATCA legislation will affect both personal and business customers who are treated as a 'US Person' for US tax purposes. The FATCA legislation will also affect certain types of businesses with US owners.

    The term US Person includes the following (but is not limited to):
    A citizen of the US, including an individual born in the US but resident in another country/territory (who has not given up their US citizenship)
    A person residing in the US, including US green card holders
    Certain persons who spend a significant number of days in the US each year
    US Corporations, US Partnerships, US estates and US trusts

    For more information regarding FATCA, please visit the IRS website or contact your tax professional.
  • The FATCA legislation becomes effective from 1 July 2014.

    Hang Seng is committed to becoming fully FATCA-compliant in all countries and territories where we operate in accordance with the legislative timeline.
  • No. Hang Seng is committed to becoming fully FATCA-compliant in all countries and territories where we operate. Other banks and financial organisations will also be affected. However their approach to ensuring compliance with FATCA may differ to that of Hang Seng.
  • To comply with FATCA, Hang Seng will:
    Conduct a review of new and existing customers to establish their status as either a US Person or Non-US Person in accordance with FATCA. Business customers will be classified according to the FATCA legislation. (For example, as US Persons, Foreign Financial Institutions or Non-Financial Foreign Entities).
    Report information to the IRS or local tax authority on all accounts held directly or indirectly by US Persons. In addition, Hang Seng may also need to report information about customers who do not provide the required documentation to us.

    In certain circumstances and where customers fail to provide the appropriate documentation or when doing business with non-compliant entities, Hang Seng may be required to apply 30% US withholding tax on certain types of US income paid to such customers.

    (Please refer to the glossary for the definitions of US Persons, Foreign Financial Institutions, Non-Financial Foreign Entities and Withholding tax)
  • FATCA legislation will impact both personal customers/sole proprietorship and business customers who hold an account, policy or agreement with Hang Seng.
    If you are a personal customer/sole proprietorship, please refer to "Personal customers/Sole proprietorship" questions
    If you are a business customer, please refer to "Business customers" questions
  • Personal customers/Sole proprietorship
  • No. If an individual's account holds any of the following seven criteria, Hang Seng may engage you in order to establish your status as either a US Person or Non-US Person in accordance with FATCA.
    US citizenship or US residence
    US place of birth
    US address including US PO boxes
    US telephone number
    Repeating payment instructions to pay amounts to a US address or an account maintained in the US
    Current Power of Attorney or signatory authority granted to a person with a US address
    In care of or hold mail address which is the sole address for the account holder
  • If you are considered a US Person (see glossary), we may need to engage you from time to time to help us understand you better. You may also wish to visit the IRS website to determine if you need to complete and submit any additional IRS forms.

    If you are a specified US Person (see Glossary), Hang Seng will be required to report information about you and your account to the local tax authority or the IRS on an annual basis. 

    We will correspond with affected customers in due course. For any detailed queries on the FATCA legislation, and what it may mean for you, please consult a professional tax and/or legal adviser for specific tax and/or legal advice.
  • For most customers, FATCA will have minimal impact, and there will be no action required. However, Hang Seng may still engage you to establish your status as a non-US Person if we have reason to believe you are potentially a US Person for FATCA purposes.
  • If a change in circumstances makes any information on a certificate or other documentation for FATCA incorrect, then the person named on the certificate/documentation must inform Hang Seng within 30 days of the change and provide a new certificate or documentary evidence.
  • FATCA does not replace the existing US tax regimes, it may however add additional requirements and complexity to the existing tax rules you may already follow. We recommend you contact a professional tax adviser to discuss your personal tax situation.
  • We will advise customers of the FATCA documentation requirement. Documents may include US tax forms (also referred to as withholding certificates or W forms) or self-declarations of FATCA status. For the full list of documents required, please also refer to the IRS website.
  • A joint account which has one US Person is treated as a US account and therefore the entire account is subject to the FATCA legislation.
  • FATCA is an ongoing process. If your account information changes, we may need to engage you from time to time to help us understand you better including requiring you to provide us with further information and documentation so that we are able to update your account status under FATCA.
  • FATCA is an ongoing process. If any of your account information changes, e.g. change of telephone number, address or nationality etc., please inform Hang Seng within 30 days of the change and we may need to engage you in order to update your status under FATCA.
  • The information reported to the IRS or to the local tax authority will depend on the FATCA status of the customer. This information will typically be of a personal nature (for example, Name, Address, US Taxpayer Identification Number), and of a financial nature (e.g. Account number, Account balance/Value).
  • Business customers
  • No. The impacts of FATCA are wider than just US companies. Hang Seng will be reaching out to many business customers globally to determine their status under FATCA. The aim of this exercise is to identify customers which are reportable under FATCA. We will be communicating with customers who need to take further action. The following criteria will be considered (but not limited to) to establish if you are a US Person under FATCA:
    US incorporated or registered
    US address including business address, correspondence address etc.
    US telephone number
    Repeating payment instructions to pay amounts to a US address or an account maintained in the US
    Current Power of Attorney or signatory authority granted to a person with a US address
    In care of or hold mail address which is the sole address for the account holder
  • In order to establish your tax status under FATCA, we may need you to provide additional information/documentation. This documentation could be a Hang Seng declaration or a US tax form from the IRS. We will be communicating with affected customers the need to complete these documents, detailing when they will need to be completed by.
  • FATCA does not replace the existing US tax regimes, it may however add additional requirements and complexity to the existing tax rules you may already follow. Should you need further advice on your tax status or FATCA classification/status, you should contact a professional tax and/or legal adviser.
  • The way in which Banks and Financial Organisations collect information from their customers in order to confirm their tax status under FATCA may vary. This may mean that in some instances you are asked for different documentation from Hang Seng than another Bank. Hang Seng cannot offer advice on your FATCA tax status or classification. If you need further support you should visit the IRS website or contact a professional tax adviser.
  • FATCA is an ongoing process. If your account information changes, we may need to engage you from time to time to help us understand you better including requiring you to provide us with further information and documentation so that we are able to update your account status under FATCA.
  • The purpose of FATCA is to prevent US Persons (see glossary) from using banks and other financial organisations to avoid US taxation on their global income and assets. Hang Seng will therefore report information to the IRS or local tax authority on all accounts held directly or indirectly by US Persons. In addition, Hang Seng may also need to report information about customers who do not provide the required documentation to us.
  • The information reported to the IRS or the local tax authority will depend on the FATCA status of the customer. This information will typically be of a personal nature in relation to the substantial US owners of a business (for example, name, address, US Taxpayer Identification Number), and of a financial nature (e.g. account number, account balance/value).
  • What do I need to do?
  • We will advise customers of FATCA documentation requirement. Documents may include US tax forms (also referred to as withholding certificates or W forms) or self-declarations of FATCA status.
  • Yes. Hang Seng will either send you the relevant forms or direct you to a website where you can download them.
  • If you are considered as a US Person, we may need to engage you from time to time to help us understand you better including requiring you to provide us with further information and documentation. Please visit the IRS website for further information.
  • In general, customers should respond to the request for FATCA documentation by the date contained within the communication.
  • Hang Seng is committed to be fully compliant with FATCA.

    Hang Seng may not open new accounts or offer additional products and services to customers who choose not to comply with Hang Seng's requests for documentation to establish a customer's status under FATCA. 

    Hang Seng may exit the relationship with customers who decide not to provide the necessary information and documentation within the regulatory timeframe. 

    Hang Seng may also need to report information about customers who do not provide the required documentation to us. 

    In addition, we may also be required to withhold tax on certain US-source payments coming into your account. (Please see the glossary for further information on Withholding tax).
  • Over the next few months we will continue to review the impact of the legislation for our customers and will correspond with affected customers in due course. For more information regarding FATCA, please visit the IRS website, or contact your professional tax adviser for advice. 

    If you have multiple relationships with us, you may be approached by different members or businesses of Hang Seng. To help us serve you better and capture your information accurately, in light of different laws or regulations in different countries and territories, your response to all our requests will be much appreciated. 

    Please note that Hang Seng is unable to offer tax and legal advice. For tax and legal related questions please contact your professional tax and legal advisers and refer to the IRS website. 
Disclaimer

The information provided herein is for reference purposes only and general in nature. It should not be considered as tax or legal advice. Hang Seng Bank Limited, its branches and subsidiaries ("Hang Seng") makes no warranty or representation of its accuracy and completeness and is not responsible for any errors, nor shall Hang Seng be liable for any loss or damage that results from reliance upon this information. Customers should seek professional legal and tax advice specific to their own situation. Please also read our Important Message to Readers and Internet Privacy Policy Statement.

The Chinese translation is for reference only. In case of any discrepancy between the English version and the Chinese version, the English version shall prevail.
 
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