FATCA, the Foreign Account Tax Compliance Act, is a US law that requires financial institutions around the world to find and report accounts belonging to US taxpayers. Its reach into the UK runs through the financial sector. UK banks, investment entities and certain insurers that are Reporting Financial Institutions carry FATCA due diligence and reporting duties, while most other UK businesses meet FATCA only when a bank or provider asks them to confirm their classification or ownership. A typical non-financial trading company has no FATCA registration or return of its own to submit.
FATCA questions often land in the same onboarding pack as a request to apply for an LEI, which is why the two get mixed up. FATCA is not an LEI requirement, and the GIIN it uses belongs to a separate system from the LEI.
FATCA Explained
FATCA stands for the Foreign Account Tax Compliance Act. The US Congress passed it in 2010 to stop US taxpayers keeping income and assets out of view of the Internal Revenue Service (IRS) by holding them in accounts abroad. The law requires financial institutions outside the US to identify accounts linked to US persons and pass details of those accounts to the US tax authorities, either directly or through their own government.
FATCA is primarily an information-reporting regime. It places no general tax on UK companies, and answering a FATCA question from your bank creates no US tax bill. The IRS overview of FATCA sets out the US side of the regime, including the separate reporting duties of US individuals with foreign assets. Each partner country’s agreement status is published on the US Treasury FATCA page. The acronym is also easily confused with the Financial Action Task Force (FATF), which sets anti-money laundering standards and runs no tax reporting system.
At its core, FATCA works on four points:
- It targets US taxpayers who hold money outside the United States.
- Financial institutions do the identifying and reporting, and account holders supply information when asked.
- Non-participating foreign financial institutions may face 30% withholding on certain US-source payments.
- Under agreements such as the UK-US agreement, financial institutions report through their national tax authority.
FATCA in the UK
The UK applies FATCA through an intergovernmental agreement with the United States, signed in September 2012 and given effect by UK regulations. Under the UK-US FATCA agreement, UK reporting financial institutions report to HMRC, and HMRC handles the exchange with the IRS.
FATCA reporting in the UK follows a fixed annual cycle:
- A UK reporting financial institution reviews the accounts it maintains, using the due-diligence procedures in the UK rules.
- It identifies reportable accounts, such as those held by specified US persons or by Passive NFFEs with US controlling persons. A trust whose investments are professionally managed may count as a financial institution, depending on the applicable tests, with its registration and reporting position determined by its FATCA classification.
- It submits the required details of those accounts to HMRC.
- HMRC passes the information to the IRS under the terms of the agreement.
Who FATCA Applies To
Direct reporting duties apply only to financial institutions with reporting status. US persons are the account holders the regime is built to identify, and ordinary UK companies, partnerships and trusts usually encounter FATCA as customers answering a bank’s questions. The questions your bank asks depend on which of these groups your organisation or its owners belong to.
UK Financial Institutions
Banks, building societies, custodians, investment entities and insurers selling cash value or annuity products are the usual examples of a FATCA financial institution. The definition turns on what an organisation does and how its assets are managed. Investments on the balance sheet do not by themselves make a company a financial institution. A company whose income comes mainly from investing may qualify as an investment entity when another financial institution manages its assets.
Classification also decides whether your organisation has to register with HMRC, so a borderline case needs a full review against the official definitions. HMRC’s guidance for financial institutions confirms that automatic exchange applies to UK resident institutions and to the UK operations of overseas institutions.
US Persons and Reportable Accounts
Under FATCA, US persons include US citizens wherever they live, US tax residents such as green card holders, and certain US companies and trusts. A dual British and American national living in Manchester counts as a US person, even without a US tax return on file. For entities, reporting generally targets specified US persons, a narrower group that leaves out categories such as listed US companies, banks and government bodies.
Banks look for signs of a US connection when they review an account, for example, a US place of birth, a US address or telephone number, or standing instructions to pay money into a US account. An account held by a passive non-financial entity may also become reportable when one or more of its controlling persons is a US citizen or US tax resident. Whether a particular individual counts as a US taxpayer depends on their own circumstances, and if you are unsure about your status, a tax adviser with US experience is the right person to ask.
UK Companies, Partnerships and Trusts
Holding a bank account does not make an ordinary UK company file a FATCA return. Its part in the system is to answer accurately when a bank, building society or investment platform asks for its FATCA status, tax residence, ownership or controlling persons. Partnerships and trusts are asked to self-certify in the same way.
Trusts need the most care, because the classification question comes first. A trust professionally managed by a financial institution may qualify as an investment entity if it also meets the applicable income test, with its registration and reporting position depending on its FATCA classification. Other trusts are account holders in the same way as a company.
A non-financial entity that meets none of the Active NFFE criteria is a Passive NFFE, typically because half or more of its income is passive, such as dividends or interest, or half or more of its assets produce passive income. Its bank will ask who controls it. For a trust, controlling persons include the settlor, the trustees, any protector, the beneficiaries or class of beneficiaries, and any other individual exercising ultimate effective control over the trust.
FATCA Classifications
Every bank form that mentions FATCA asks your organisation to choose a category, and that choice decides what else the bank needs from you. A wrong answer on a self-certification may lead to an account being reported when it should not be, or missed when it should be. NFFE, a term found on most forms, stands for Non-Financial Foreign Entity. The word foreign reflects the US point of view, so a UK trading company is a foreign entity for FATCA purposes.
| Classification | General meaning | Information commonly requested |
|---|---|---|
| Financial Institution | A bank, custodian, investment entity or specified insurance company. Classification depends on its activities. | FATCA status and, where applicable, a GIIN |
| Active NFFE | A non-financial entity that meets an Active NFFE test. Under the income-and-assets test, less than 50% of its gross income is passive and less than 50% of its assets produce, or are held to produce, passive income. Separate tests apply to listed companies and qualifying group entities. | Tax residence, Tax Identification Number and confirmation of Active NFFE status |
| Passive NFFE | A non-financial entity that does not meet any Active NFFE test. Investment-holding companies and some trusts may fall into this category. | Details of controlling persons, including whether any are US persons |
| Exempt or specially treated entity | An entity with a defined exemption or special status, such as certain government bodies, pension funds or deemed-compliant institutions. | The category claimed and the basis for claiming it |
Each category rests on legal tests with conditions and exceptions of their own. Where your organisation sits close to a boundary, check the full definitions, or ask an adviser, before anyone signs the form.
FATCA Checks by Banks and Financial Providers
A bank asks for FATCA information because the law requires it to classify the accounts it holds and keep evidence of how it reached each decision. The request is part of the bank’s own due diligence, and receiving one says nothing about whether you or your business owe US tax. Banks put FATCA questions to entity customers as a standard step at account opening and during periodic reviews.
Requests usually arrive as a self-certification form covering FATCA and CRS together, which someone authorised to act for the organisation completes and signs.
Information Banks May Request
The exact request depends on the type of customer and account. A bank may ask for:
- Country of tax residence
- Tax Identification Number, such as a UK Unique Taxpayer Reference or a US TIN
- Country of incorporation or organisation
- FATCA entity classification
- Details of controlling persons, including their own tax residence and Tax Identification Numbers
- Supporting documents, such as a certificate of incorporation, trust deed or ownership chart
If the Information Is Not Provided
A provider that cannot complete its checks has limited options. It may delay or decline a new account application, ask for further documents, or report the account on the information already on file.
HMRC’s guidance for account holders places a duty on you to reply to your account provider with correct and complete details. HMRC may charge a penalty of up to £300 where a person deliberately or carelessly fails to provide correct information about their place of residence or Tax Identification Number.
Information Reported Under FATCA
Under FATCA reporting, a UK reporting financial institution sends HMRC details of each reportable account, and HMRC forwards the relevant data to the US. The fields vary with the account type and the holder, so a savings account held by one individual produces a shorter record than a custody account held by a Passive NFFE with US controlling persons.
Depending on the account, the report may contain the following information.
| Information | What it covers |
|---|---|
| Account holder name and address | The individual or entity holding the account and, for a Passive NFFE, each reportable controlling person |
| US Tax Identification Number | The US TIN of each reportable person |
| Account number | The number the institution uses to identify the account, or an alternative reference where none exists |
| Financial institution details | The name and identifying number of the reporting institution, such as its GIIN |
| Account balance or value | The balance at the end of the calendar year, or immediately before closure for an account closed during the year |
| Income and payments | Amounts paid or credited to the account, such as interest, dividends and gross proceeds from sales or redemptions, depending on the account type |
FATCA Compliance for UK Financial Institutions
For a reporting financial institution, FATCA compliance runs as an annual cycle, with reporting to HMRC where a return is required. It sits alongside the other regulatory reporting obligations a UK firm manages and depends on the same foundations: correct classification, reliable customer data and records that stand up to an HMRC review.
A UK institution typically works through these stages:
- Confirm whether your organisation meets the definition of a financial institution.
- Establish its FATCA classification, including any exempt or deemed-compliant status.
- Register with the IRS and obtain a GIIN, where your classification requires one.
- Register for HMRC’s Automatic Exchange of Information (AEOI) service.
- Carry out due diligence on new and existing accounts, and collect valid self-certifications.
- Submit any required annual return to HMRC and keep records of the work behind it.
A reporting financial institution or Trustee-Documented Trust must register for HMRC’s AEOI service even when it has no information to report. An organisation that becomes one of these entities must register by 31 January of the following year, as set out in HMRC’s AEOI registration guidance. Institutions that need a GIIN apply through the IRS FATCA registration system.
The UK filing date is 31 May following the end of each calendar year, so returns covering 2026 are due by 31 May 2027. Technical requirements change over time. Check HMRC’s current guidance and the reporting deadline before each filing season.
From 1 January 2027: FATCA and CRS reports go to HMRC as separate XML submissions. HMRC’s combined CRS and FATCA schema will no longer be accepted after 31 December 2026, and the change also covers submissions that relate to earlier years. HMRC’s AEOI reporting guidance names the replacement formats for each regime.
FATCA vs CRS
FATCA and the Common Reporting Standard share a purpose and much of their machinery, and UK institutions often run them through one compliance process. FATCA looks only for US taxpayers. CRS, developed by the OECD, looks at tax residence across multiple reportable jurisdictions, which gives it a far wider scope.
| Area | FATCA | CRS |
|---|---|---|
| Origin | US law | OECD standard |
| Main focus | Accounts connected to US taxpayers | Accounts held by tax residents of reportable jurisdictions |
| UK reporting route | Financial institution to HMRC, then exchange with the IRS | Financial institution to HMRC, then exchange with reportable jurisdictions |
| Institution identifier | GIIN for relevant financial institutions | No direct equivalent to the GIIN |
The UK brought amended Common Reporting Standard rules into force on 1 January 2026, extending CRS to certain electronic money products.
FATCA, GIINs and LEIs
A GIIN and an LEI are separate identifiers, and FATCA contains no general rule requiring an affected entity to hold an LEI. The GIIN, or Global Intermediary Identification Number, is the FATCA identifier. The IRS issues it to financial institutions and certain other entities that register in the FATCA system, and its guidance on GIIN composition explains how the 19 characters are built.
An LEI number belongs to the Global LEI System. It is a 20-character code under the ISO 17442 standard that identifies a legal entity taking part in financial transactions, and its reference data is renewed every year.
| Feature | GIIN | LEI |
|---|---|---|
| Issued by | The IRS, through FATCA registration | Accredited LEI issuers in the Global LEI System |
| Identifies | Financial institutions and certain other entities registered for FATCA | Legal entities that take part in financial transactions |
| Format | 19 characters | 20 characters |
| Public record | IRS FFI list | Global LEI Index |
| Upkeep | Registration maintained in the IRS system | Reference data renewed annually |
Some UK firms need both. An investment firm may hold a GIIN because it reports under FATCA and an LEI because UK rules require one for transaction reporting, with each identifier answering to its own regime. Which businesses need an LEI number depends on activities such as trading, reporting and fund administration, not on FATCA status. Holding an LEI does not register you for FATCA or satisfy any FATCA obligation.
Practical Next Steps for UK Businesses
What to do next depends on which side of FATCA you are on. An entity answering a bank’s request needs an accurate self-certification and a habit of keeping it current. A financial institution with reporting duties needs registrations, procedures and records that match its classification.
For Entity Account Holders
If your bank or provider has sent a FATCA request, work through these steps:
- Confirm why the provider needs the information and which accounts it relates to.
- Review your organisation’s legal form, activities, tax residence and ownership.
- Decide your FATCA classification against the relevant definitions.
- Identify your controlling persons, where your classification calls for them.
- Complete and sign the self-certification accurately.
- Keep copies of the form and supporting records, and tell the provider when your circumstances change.
If your organisation is a trust, an investment business or part of a group with complex international ownership, take professional advice before you sign.
For Reporting Financial Institutions
If your organisation has FATCA reporting duties, check that you have:
- Confirmed your FATCA and AEOI status.
- Checked that your IRS and HMRC registrations are current.
- Reviewed your due-diligence procedures for new and existing accounts.
- Identified every reportable account for the year.
- Checked the submission requirements and deadline for the coming filing season.
- Retained the evidence and records behind each classification and report.
The detailed due-diligence and reporting rules sit in HMRC’s International Exchange of Information Manual, which HMRC updates as the regimes change.
Frequently Asked Questions
Is FATCA a tax?
No. FATCA sets reporting and due-diligence rules and places no general tax on UK businesses. Any underlying US tax liability comes from a person’s or entity’s own US tax position.
Does FATCA replace existing US tax-reporting rules?
No. FATCA works alongside other US tax and reporting requirements. US individuals and companies still have their own filing obligations, which FATCA reporting by banks does not replace.
How often should FATCA information be updated?
Whenever your circumstances change, tell your provider if your tax residence, ownership, controlling persons or classification changes. Your provider may also ask you to reconfirm details during reviews.
Can a UK citizen be affected by FATCA?
UK citizenship alone does not create a FATCA connection. You are affected if you are also a US citizen, a US tax resident or otherwise a US person for tax purposes.
