Americans with foreign bank accounts, doing business in the US - do you need to make an FBAR report?
With America getting tough on tax haven abuse the authorities in Washington are tightening up on the reporting (to the US Treasury) of the existence of non American bank accounts held by United States persons.
A 'United States person' is:
- a citizen or resident of the United States
- a person in, and doing business in, the United States.
The term 'person' includes individuals and all forms of business entities, trusts, and estates.
This definition has been widened and could include a UK company doing business in the US. The rules for these reports (known as FBAR reports) have been around for some time but I understand that the US Treasury are becoming more vigilant in this area. There is a de-minimis amount of $10,000 so if the amount in the account does not exceed this amount at any time in the year it does not need reporting otherwise it must be disclosed.
If you hold any non American accounts and are a 'US Person' I suggest you contact your US advisers as soon as possible as there is a deadline of 30 June 2009 to file a report for the 2008 calendar year. It is not possible to get an extension and any late report must be explained. There can be significant penalties for failing to make a report.
At Mercer & Hole we do not offer advice on US matters but we can put you in touch with an appropriate firm via our membership of TIAG.
Comment on this blog in the space provided below. Barry Hallam is a Senior Tax Manager at Mercer & Hole.
