The US and Luxembourg governments have signed an agreement to improve international tax compliance and to implement the Foreign Account Tax Compliance Act (FATCA).
On 27 February 2014, the Luxembourg and US negotiating teams agreed on the substance of the Model 1 Agreement.
ALFI – the Association of the Luxembourg Fund Industry – has welcomed the signature of this intergovernmental agreement (IGA).
The association has been working hard to ensure that its members are best prepared for the implementation of FATCA. A Q&A document is being finalised by ALFI's FATCA implementation working group. The working group comprises representatives of asset managers, management companies, securities service providers, audit firms, law firms, the Luxembourg Pension Funds Association and information management firms. The Q&A document will serve ALFI members as a reference document when it comes to implementing FATCA.
As part of the signing of the FATCA Model 1 intergovernmental agreement between Luxembourg and the US, the Luxembourg Tax Administration has set up two working groups bringing together different actors from the public and private sectors in order to implement the automatic exchange of information under this agreement.
The first working group focuses on general issues relating to the implementation of the agreement, while the second will deal mainly with technical questions regarding the electronic communication of information between reporting financial institutions and the Tax Administration.