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FATCA refers to Foreign Account Tax Compliance Act. It is a US initiative which has also been entered into by Indian government. Under this agreement, the Indian government needs to give details of all US citizens holding prescribed securities and assets in India.
The National Securities Depository Limited (NSDL) allows National Pension Scheme (NPS) members to update their Foreign Account Tax Compliance Act (FATCA) self-certification online. This guide will help you understand the online FATCA self-certification process, why it is necessary, and how to file self-certification for FATCA.
India signed an inter-governmental agreement (IGA) with the US to implement FATCA, effective 31 August 2015. FATCA enables the automatic exchange of financial information between the two countries. Under this agreement, Indian financial institutions must report relevant financial data to Indian tax authorities, who then share it with the US.
FATCA is of vital importance because it was previously communicated that non-submission of this self-declaration will result in the blocking of the NPS account. Although, later no accounts were actually blocked. But currently, if you do not file this declaration, you will not be able to either -
From your NPS or PRAN account. The declaration is already effective for Mutual Funds, etc.
Self-certification is the process where Indian financial institutions ask NRI account holders to verify certain details about themselves. Following this, the institutions perform due diligence to validate the self-declaration. If you opened an NPS account with NSDL on or after July 1, 2014, and failed to complete the self-certification, your account will be blocked.
It is always preferable to file the self-declaration online. The CRA (Central Recordkeeping Agency) not receiving the offline FATCA form in a timely manner can cause problems with making withdrawals and depositing money in NPS or PRAN accounts.
Offline FATCA self-declaration should be filed if your -
For the purpose of taxation is other than India or is US (United States). You can access the FATCA form here.
You would be required to follow these steps for submitting FATCA online
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You can check the status of your FATCA registration by logging into your FATCA account and viewing the account status displayed on the home page. The system will also generate automatic email notifications to the responsible officer (RO) whenever there is a change in the registration status.
The FATCA declaration form can be submitted to the National Pension Scheme. Physical FATCA certification for NPS has to be sent to the Central Recordkeeping Agency (CRA) at the address given below -
NSDL e-Governance Infrastructure Limited, Kamala Mills Compound, Senapati Bapat Marg, Lower Parel, Mumbai – 400 013
It is essential to understand that submitting the FATCA self-declaration is crucial. Although no NPS accounts have been blocked to date, not filing this declaration means you cannot deposit into or withdraw from your NPS or PRAN account. Compliance with FATCA ensures your account remains fully operational.
The Taxpayer Identifying Number (TIN) is a unique nine-digit number that the Internal Revenue Service (IRS) uses to oversee tax laws in the United States. The Social Security Administration (SSA) or the IRS issues this number. It serves as a key identifier for individuals and entities within the tax system.
APY/NPS-Lite subscribers must submit a completed FATCA self-certification form to their respective APY Service Provider (SP), Aggregator, NPS-Lite Accounting Office (NL-AO), or CRA. Please note that online FATCA self-certification is not available for APY/NPS-Lite members.
If your birthplace, citizenship, or residence for tax purposes is outside India, you are required to submit a physical FATCA Self-Certification form to your Nodal Officer or Central Record Keeping Agency (CRA).
