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(QCOSTARICA) — Officials from Mexico’s Tax Administration Service (SAT) last month met with Costa Rican tax administration officials, to share their experiences in the area of tax information exchange.

The Costa Rican authorities learned from Mexico’s experience in implementing the US Foreign Account Tax Compliance Act (FATCA) and the OECD’s Common Reporting Standard (CRS), according to a statement from the Inter-American Center of Tax Administrations (CIAT), released after the meeting held April 20 to 22, 2015.

FATCA, enacted by the US Congress in 2010, is intended to ensure that the Internal Revenue Service (IRS) obtains information on accounts held abroad at foreign financial institutions (FFIs) by US persons. Failure by an FFI to disclose information on their US clients, including account ownership, balances and amounts moving in and out of the accounts, will result in a requirement on US financial institutions to withhold 30 percent tax on US-source income.

On November 26, 2013, Costa Rica signed a Model 1A intergovernmental agreement (IGA) with the US to implement FATCA. The Model 1A agreement also provides that the US will also provide tax information to the Costa Rican Government regarding Costa Rican individuals with accounts in the US.

Source: Tax-News.com