On 29 November 2013, the U.S.A. and the Cayman Islands signed an Intergovernmental Agreement (IGA) on the basis of a Model I template, in order to improve international tax compliance and to implement the Foreign Account Tax Compliance Act (FATCA).
Foreign Financial Institutions in the Cayman Islands will be now required to report tax information about U.S. account holders directly to the Cayman Islands Tax Information Authority. The Cayman Islands Tax Information Authority will in turn relay that information to the U.S. Internal Revenue Service (the IRS).
The IGA is non-reciprocal; the IRS will not report to the Cayman Islands on Caymanian account holders in the U.S.
The text of the signed agreement has been published on the website of the U.S. Treasury.
This is the tenth FACTA bilateral Model I agreement to be published so far; the previous nine were signed between the U.S.A. and, individually, the United Kingdom, Denmark, Mexico, Ireland, Norway, Spain, Germany, France and Costa Rica.
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