FATCA refers to Foreign Account Tax Compliance Act. It is a way of confirming by Mutual Fund to ensure that you are paying taxes only in India and not in any other country.
What is FATCA
FATCA was an act passed by the USA in the year 2010. As a person living in the USA can either be a citizen or a green card holder, The financial institution requires, as per the Act, to furnish details of the tax status of the individual. it was enacted to ensure tax evasion.
Relevance of FATCA for Mutual Fund investor
If you have made an investment in any Indian Mutual Fund on or after 01 July 2014, then you are required to furnish FATCA details. It confirms that you are an Indian citizen and are paying taxes only in India if you are paying taxes in the USA too then you are required to furnish tax identification number to the Mutual Fund.
What details are required to be filled in FATCA and how to do it?
FATCA declaration can be done online by filling a simple form which has details like the country of birth, country living presently and whether paying taxes in any country other than India.
Need for filling FATCA
Declaration of FATCA has now been made mandatory by many Mutual Fund houses to carry out any transactions like purchase redemption etc.As an investor just check out your Mutual Fund site and see the FATCA declaration form for filing up. The same may also be done by Mutual Fund Registrar and Transfer vAgents.
FATCA filing is not cumbersome of difficult to do. you may either do it online or may approach Mutual Fund Office or offices of RT&A for doing the same