Jan. 30, 2020 - In our annual Tax Review and Outlook report, we look back at significant developments that shaped the Canadian and U.S. tax landscapes in 2019 and offer our predictions on what to expect in the year ahead. Key Canadian Developments in 2019 Proposed changes to the employee stock option rules...
Canada and U.S. Enter into FATCA Intergovernmental Agreement
The U.S. Treasury Department and the Canadian government both announced today that Canada and the United States have signed an intergovernmental agreement (IGA) to implement the provisions of FATCA. The agreement is a “Model I” agreement, which provides for direct information exchange between the U.S. and Canada, with each government collecting from its local financial institutions the relevant information on account holders who are taxpayers of the other country. It had been reported that Canada was seeking to limit its disclosure obligations to account holders who are U.S. residents, but unfortunately the IGA does impose reporting on Canada with respect to U.S. citizens resident in Canada. The main beneficiaries of the IGA are Canadian financial institutions (FFIs) who will be spared the need to enter into individual FATCA FFI Agreements with the IRS. Canadian FFIs still need to register through the IRS web portal for FATCA to obtain a global intermediary identification number (GIIN) to avoid the withholding rules on U.S. source payments that go into effect on July 1st of this year. The necessary Canadian statutory provisions to give effect to the agreement have been released in draft form.
Jan. 30, 2020 - Review of U.S. Tax Developments in 2019 In 2019, the U.S. tax world continued to be primarily concerned with developing guidance under the monumental Tax Cuts and Jobs Act (TCJA), which was enacted at the end of 2017. Major regulatory projects were proposed beginning in 2018,...