TORONTO, Feb. 5, 2014 /CNW/ - The Investment Funds Institute of Canada (IFIC) released a statement today commending the federal government for the exemptions and relief it has secured on behalf of Canadian investors through the Intergovernmental Agreement (IGA) that it has negotiated with the U.S. government to implement the Foreign Account Tax Compliance Act (FATCA).
Under the IGA, registered plans, including RRSPs, RRIFs, RESPs, RDSPs and TFSAs, are exempted from FATCA and will not be reportable. This will benefit the millions of Canadians who hold mutual funds in these types of plans.
The agreement safeguards Canadian investors by ensuring that Canadian financial institutions will not be required to close client accounts or send any reporting directly to the IRS.
"On behalf of Canadian investors, we want to recognize the government for its dedication in working to reduce the impact of FATCA on Canadian investors," stated Joanne De Laurentiis, IFIC's president and CEO. "The mutual funds industry is committed to a strong, stable investment sector where investors can realize their financial goals. The exemptions and relief secured by the Canadian government under the IGA will provide welcome relief to Canadian investors who may be subject to U.S. tax rules as they save for retirement and other important life events."
While the release of the IGA represents a major step, details of how financial institutions will be required to implement the IGA will be contained in implementing legislation. We will be reviewing the legislation and guidelines when they are released.
The Investment Funds Institute of Canada is the voice of Canada's investment funds industry. IFIC brings together 150 organizations, including fund managers, distributors and industry service organizations, to foster a strong, stable investment sector where investors can realize their financial goals. By connecting Canada's savers to Canada's economy, our industry contributes significantly to Canadian economic growth and job creation. The organization is proud to have served Canada's mutual funds industry and its investors for more than 50 years.
SOURCE: The Investment Funds Institute of Canada
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