Credit Union Central of Canada: FATCA Deadline Approaches. Details Remain Elusive

Badger posted this under What’s New, but I think an article from Central  Credit Unions of Canada (FATCA Deadline Approaches. Details Remain Elusive) deserves a post of its own. Thanks Badger for this great find.

According to the article, Credit Unions Central of Canada continue to attend periodic briefings with Finance Canada and CRA. Well, that’s certainly more than those of us most directly affected are getting.

They continue to be told negotiations are still underway and that nothing will be announced until 2014 (Again, that’s a bit better answer than the “soon” we have been receiving for over a year.)

Based on “well-informed predictions” of Canadian officials (would be nice if they would tell us too!):

If a IGA is signed, credit unions would report to CRA who would report to IRS. Credit unions would begin in July, 2014 to screen for “US persons” on account openings. (Happy Canada Day! But, no word on just how they are going to work around  around Canadian human rights and privacy laws to do that.)

This also says obligations would be determined by Canadian, not U.S. law. Again, no word if Canadian laws would be changed.  (That, of course, then gets us into a Charter challenge).

Reporting will begin on new accounts and on accounts over $1 million in 2015 and on accounts over $50,000 in 2016.

This suggests RRSPs, RRIFs, TFSAs and Agri-Invest accounts will be exempt from reporting.  It does not mention RESPs or RDSPs.  Calgay411 has said credit unions don’t offer RDSPs. Does anyone know if they provide RESPs

Credit unions with less than $175 million in assets are exempt.  Credit unions over that amount but with 98% of members who are Canadian residents would focus on reporting on US persons who are non-residents of Canada.

This also says Canadian financial institutions will have a choice when opening new accounts to either use self-certification or US indicia like US address, passport, telephone number, etc.

Most significantly, this says:

A question about place of birth will not be required.

 

It also says special rules are being created for people who are not US persons, but who have a US address like snowbirds or students.

We are still being left out of the loop on these threats being made against us, but this is much better information and tone than we’ve seen from Canadian Bankers Assocation. Unlike CBA, there is absolutely no threat to close accounts in this document.

9 thoughts on “Credit Union Central of Canada: FATCA Deadline Approaches. Details Remain Elusive

  1. calgary411

    Information on credit unions that do offer RDSPs is in the link in my comment above.

    (…and, right, RESPs are also not mentioned in the Central Credit Unions of Canada (FATCA Deadline Approaches. Details Remain Elusive.)

    “Does anyone know if they provide RESPs?” It looks like some do?

    http://www.servicecanada.gc.ca/eng/goc/resp.shtml
    “Application Information
    Visit the CanLearn Web site to get more details on RESP.
    Information on the RESP application procedure is also available through financial institutions, such as a bank or credit union, or through a certified financial planner or a group plan dealer. These institutions, planners and dealers are known as “RESP providers.”

    I still want a whole lot more clarification from our government and soon.

    Reply
  2. calgary411

    This appears mostly positive and I think we need this information confirmed by Canada’s Finance Minister.

    I don’t see any reference to the RDSP in the Central Credit Unions of Canada (FATCA Deadline Approaches. Details Remain Elusive). I guess I still await information from the Government of Canada. I speculate why it may NOT be exempt and give some resources for those who may want to transfer at this point from a bank to a credit union (if it doesn’t call attention to “Why?” which I got when I inquired a while back. http://isaacbrocksociety.ca/fatca/comment-page-68/#comment-856421

    Reply
  3. OutragedCanadian

    @Badger, I agree, however, being a bit of a pessimist, I’m not sure how realistic a NO actually is. Maybe I’m settling for too little, but after so long of what just seems to be dire news, I’ll take the article as a hopeful sign.

    Reply
  4. badger

    We cannot let even the ‘camel’s nose into the tent’.

    No FATCA is the only ‘good’ FATCA.

    It remains an unilaterally imposed Made-in-the-USA law designed to benefit only the US. The terms can be altered at any time by the US without consent or notice to the IGA signatory. Witness the way that the US did not bother to even notify Canada that it was imposing the Obamacare investment tax on all those it deems to be ‘US taxable persons’ anywhere in the universe – including Canada, despite the US-Canada tax treaty that is supposed to prevent double taxation. Just like it doesn’t prevent extraterritorial US double taxation-confiscation of our RESPs, TFSAs, RDSPs, Canadian mutual funds, capital gains on sale of our Canadian principal residence, etc. RRSPs and RRIFS are only exempted with annual treaty election as prescribed, without fail.

    The US can change anything it wants to anytime, if Canada signs any form of FATCA IGA. There is NO form of FATCA that is acceptable.

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  5. Blaze Post author

    @GlobalCitizen: It is a much better Christmas gift than Minister Flaherty, Finance Canda or Canadian Bankers Association seem prepared to give us.

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  6. Globalcitizen

    Wow, thanks for posting this! I anticipated that the feds would not not cave in entirely to the U.S.. Of course, until the IGA is released we will not know for sure what they agreed to, but this at least makes it slightly less awful to contemplate.

    Reply

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