Tuesday, December 06, 2022

Exchanging financial information with the US: how to protect assets according to experts

AFIP chief Carlos Castaneto declared that “it is Very close to an agreement with the United States for the automatic exchange of information on Argentine bank accounts in that country. However, for experts in Argentina and the United States, it is still lacking.

For Castaneto,”Cannot report more than $100 billion“By Argentinian taxpayers in US banks.

To reach the goal of keeping track of where those dollars are hidden, AFIP has pretty tough fences to jump over, but sooner or later it will comeaccording to experts.

In this sense, Néstor De Lisio of RSM Argentina proposed Decide between: “Worry? Make hasty decisions? Or take the issue lightly and do nothing?,

“These are some of the questions we face every day, and answer somewhere in the middle“, she claimed.

Will the information provided by the US be effective?

A lawyer in the United States, a correspondent for an Argentine firm, who preferred to remain anonymous, said that “the US tells Massa that information exchange with Argentina will take place within FATCATax compliance law for foreign accounts”.

US sources have indicated that an agreement will be signed within the FATCA framework

“You Within FATCA, the United States signs the so-called IGA Model Ageement with some countries“, he indicated, specifying:

1. And one is signed Reciprocal IGA model 1, implies that there is automatic exchange information between the parties.

However, for the time being, the US will only exchange Information of holders of bank accounts and not of final beneficiaries,

2. In case of signing a IGA Model 2, US account holders also won’t reach Argentina, Since the exchange of the said information will not be mutual.

,For the automatic and reciprocal exchange of tax information to take place, in the sense that it is truly effective, the US must modify its internal law on the exchange of information on ultimate beneficiaries. of the account holders,” he clarified.

“About Companies and real estate owners, North American law to be amended to oblige registration of information And make it available to the IRS.”

On companies and real estate, the exchange will not be permitted by US law

This would limit access to US$100 billion, but That doesn’t mean it won’t allow a good portion of that undisclosed money to be personalised.,

Does AFIP get a response from US banks today?

Within the framework of the 2016 bilateral agreement, “on request” for the exchange of information, Roca pointed out that “In recent weeks some US financial institutions began to receive information requirements from the IRS regarding Argentine taxpayers,

“In those notices, They are requested to document related to Argentine accounts, such as monthly statements, data opening and registration of signatures, details of fund activities; Credit cards, investing in private banking, among others“, he remarked.

Roca explained, “AFIP requests information not only in terms of accounts owned by the taxpayer, but also accounts whose ownership is indirectly enforced.”

In this way, AFIP attempts to apply the premise of the OECD model to the United States, which was not signed by that country.

AFIP is already soliciting information from US banks with existing agreements

The only agreement so far signed between Argentina and the US accepts the exchange of only Financial information upon request, but AFIP must prove that it presents it in the framework of an open oversightFor specific accounts and with evidence that there may be an illegal act.

Nevertheless, AFIP is getting many positive responses from banks in USA today,

At what level does the US ask to sign the agreement?

The same lawyer for the United States emphasized that “one thing is for the IRS to agree to sign an agreement with Argentina within the framework of FATCA, and secondly for the United States government to allow it.” gives.”

The first obstacle facing the information exchange agreement is that the United States has already ruled that Cannot be signed between AFIP and IRSYour tax collection agency.

“An agreement for the automatic exchange of financial information, even if there is political will, Will require the approval of the Executive Branch and be ratified by Congress“, confirmed Carlos Roca, president of Croca Consultants.

However, De Lisio warned that “It’s hard to predict a word, it could be a month, three years, ten years, but at some point it will be specified“The signing of the agreement.

Although the time frame may not be known, the automatic exchange of information will be signed

How to act before the progress of the agreement with the US

“The relations between countries in fiscal matters point to this objective of transparency. In fact, the US already has agreements with many countries for the automatic exchange of information,” he recalled.

“This time, Appropriate confidentiality appears to be a significant barrier to the progress of procedures. Which should be given to the whole process,” he said.

“We must not forget that, in this case, Argentina does not present good credit, if we remember that shortly after the end of the most important integrity (laundering) regime in history (approximately US$120.00 million), the proliferation of people List who joined the regime,” he warned.

“Then The answer to the question about how to work is: You have to work on the analysis of inheritance“, he insisted.

“Too Its owner’s objectives, contingencies that may affect it, family planning, many other elements that form a serious basis for case studies“, He added.

“For the purpose of all this Provide proper legal and tax structure to that inheritance So that the occurrence of one event does not destroy the work done for many years,” he concluded.

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