Greece, US Sign FATCA Intergovernmental Agreement

On January 19, Greece and the United States signed an intergovernmental agreement (IGA) to facilitate compliance with the US Foreign Account Tax Compliance Act (FATCA) by financial institutions (FIs) in Greece.

FATCA is intended to ensure that the US Internal Revenue Service (IRS) obtains information on financial accounts held at foreign financial institutions (FFIs) by US persons. Failure by an FFI to disclose information on their US clients results in a requirement to withhold 30 percent tax on payments of US-sourced income.

To address situations where foreign law would prevent an FFI from complying with the terms of an FFI agreement, the US Treasury developed model IGAs. The IGA is intended to simplify compliance with FATCA by Greek financial institutions by enabling them to transmit information to the US through a centralized agency in Greece.