FATCA

The Foreign Account Tax Compliance Act (FATCA), which came into effect on July 1, 2014, is a new legislative law enacted by the United States. This law was established to combat tax evasion by Americans and to provide a high degree of transparency in tax matters. It was also enacted to address the new information reporting and withholding requirements that must be applied in financial institutions worldwide, including Saudi banks and other financial institutions identified under the Foreign Account Tax Compliance Act (FATCA). The Kingdom of Saudi Arabia has entered into an international agreement with the United States to facilitate compliance with this law.

The Common Reporting Standard (CRS) is a standard for the automatic exchange of financial account information related to tax matters, issued by the Organization for Economic Co-operation and Development (OECD), of which the Kingdom of Saudi Arabia is a member. The Kingdom of Saudi Arabia has the required legislation in place with an effective date for compliance with the Common Reporting Standard starting from September 8, 2017. Will you be affected by the presence of the Foreign Account Tax Compliance Act (FATCA) and the Common Reporting Standard (CRS)? These laws are likely to affect any client of the company or other financial institutions, regardless of the client's nationality, tax residence, or national status. The Common Reporting Standard (CRS) is a standard for the automatic exchange of financial account information related to tax matters, issued by the Organization for Economic Co-operation and Development (OECD), of which the Kingdom of Saudi Arabia is a member. The Kingdom of Saudi Arabia has the required legislation in place with an effective date for compliance with the Common Reporting Standard starting from September 8, 2017. Will you be affected by the presence of the Foreign Account Tax Compliance Act (FATCA) and the Common Reporting Standard (CRS)? These laws are likely to affect any client of the company or other financial institutions, regardless of the client's nationality, tax residence, or national status. This is because banks and other financial institutions are required to review the information they hold regarding their clients to ensure their tax status. If the company or other financial institutions do not have any information stored about you in this regard, the financial institution will contact you to provide them with additional documents and information to verify your tax status.

If you receive a call from the company or other financial institutions requesting additional information, you must then provide the required information and documents within 30 days from the date of the request. Please note that if you have multiple banking or financial relationships with a financial institution, you may receive several calls at different times requesting you to provide information to that financial institution. Therefore, please respond to these requests even if you have previously provided the required information for a different account or financial product. We emphasize here the necessity of being vigilant and ensuring the reliability of these communications and that they are official to avoid any other fraudulent communications not from the company. In the event that you refuse to provide the required documents, the company is obligated to classify you based on the information available in your file. Consequently, the company may treat you as a U.S. citizen or a resident of the United States or any other country for tax purposes. The company may also report your tax status to the relevant Saudi authority or take appropriate regulatory actions, or both. The company annually sends tax reporting reports to the relevant Saudi authority in accordance with the laws of the Kingdom of Saudi Arabia, and this entity, in turn, submits this information to the Internal Revenue Service in the United States or the countries participating in the Organization for Economic Cooperation and Development according to tax exchange agreements. In case of any change in circumstances in the future, you must inform the company within 30 days from the date of the change.

For more information about the FATCA law and how it affects you, please refer to the website of the Internal Revenue Service in the United States. https://www.irs.gov For more information on the Common Reporting Standard, please refer to the website of the Organization for Economic Co-operation and Development. https://www.oecd.org/tax/automatic-exchange