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FATCA Declaration for NPS

Are you right now living in the US? Are you old enough to be thinking about your pension? Then, the FATCA declaration for NPS is surely not something new to you. Here, we’ll take you through all you need to do about the FATCA declaration NPS, so all you have to do is follow our instructions.

What is FATCA in NPS registration?

Let us first begin with a good and clear understanding of what the NPS FATCA declaration is. The term FATCA stands for the Foreign Account Tax Compliance Act.

In other words, this is a kind of system that collects information and reports regarding taxes. This is by reviewing Financial Institutions (FI) US accounts.

In other words, this is nothing but a tax law that the US imposes to bring about a kind of transparency between nations and prevent any malpractice in paying taxes and savings schemes.

This way, it keeps a close track of revenues that one receives from holdings overseas.

So, according to the National Tax Rule of 1962, all NRIs living in the US must fill in their Form 61 B if they are to invest in India. These investments could include mutual funds, capital gains, PPFs, equities, or even interests in banks.

In addition to that, it could also include household assets like jewellery, vehicles, and even antique pieces and other such collectables. If it is of value, it comes under assets.

This is how Indian financial institutions self-declare their compliance with FATCA. The government passed on its approval to the FATCA in the year 2015. Since then, all Indian citizens living in the US can self-declare their compliance to FATCA, that is, if they choose to invest in India.

Indian financial institutions will then do the rest as they take the next step to validate these self-declarations. This now applies to all NRIs who choose to work in the US, failing by which they will be unable to avail themselves of the benefits of the NPS.

Are FATCA details mandatory for NPS? 

Yes. Failing by which your NPS account could be blocked. This means you will no longer be able to avail the benefits one is entitled to as per the National Pension Scheme. This could, in the long run, lead to a lot of issues about equities and debts.

But then, you already know this, don’t you? Here’s what you probably don’t know.

In addition to that, the government could also take the most severe step of freezing all your bank accounts and suspending some of your investments. In other words, the authorities could suspend your mutual funds, fixed deposits, and other important investments.

So, let’s take the NPS FATCA declaration very seriously. NRIs living in the US will have to provide a report of their income not only to avail the benefits of the National Pension Scheme but also to protect their assets and enjoy a comfortable living.

All you have to do is authenticate some basic information about yourself that Indian Financial Institutions would require, and you can go on peacefully living in the US.

Make sure that you submit your form of self-certification form to the concerned authorities
 

This could be an APY service provider, an aggregator, a CRA, or an NPI LIfe accounting office.

So, what is stopping you? Okay, we know what it is, so read on.

Steps To the FATCA Declaration In NPS 

Finding it hard to go through the whole process. Don’t worry, it’s not complicated, and here is what we will do on our part to help.

You can easily find the form online from the NSDL website. So, here is the first step. Visit the website, and once there, read on as we guide you step by step.
 

  • Find the form - You may have to look through the list of alternatives on the page. Nevertheless, the form is easy to find.
  • Press Submit - Before that, ensure you enter your PRAN number.
  • Fill out the form - Now, for the most important part. All you have to do is provide some essential details. This includes your name (of course) along with your PAN number, address, income, occupation, and nationality.
  • Residents of other countries will have to provide additional details, namely their tax residency number. Citizens not born in India may also have to provide their tax identification number (TIN).
  • If you don’t have one, you can provide any other equivalent of this, provided it is from the nation you were born in. If this is impossible, you may also have to complete the form in part four, which is the self-certification section.
  • In addition to that, you may also have to provide some further evidence by way of a PAN card, passport, driver's license, or other such mark of identification.
  • After you have finished and provided all information to the point of accuracy, you can go ahead and click submit. You can then sign the declaration by checking the box you see, following this with your name and the date on which you signed it.
  • Remember that by doing this, you are giving your word that all of the information you have provided is true to the best of your knowledge.
  • Now, all you have to do is wait for the one-time password that you will soon receive on the number that you registered. And this is how you complete the self-declaration process of the NPS FATCA declaration online.
  • Authenticate with the number you receive, and you are done. You can now breathe a sigh of relief as you see the FATCA declaration NPS certification appearing on your screen.

You can now go ahead and enjoy the rest of the day. No more paperwork for today. However, make sure that you save the certification before you go. You never know when you are going to need to show it as proof on a later day. Inconveniences do occur, and when it does, it can be very irritating, you know?

What happens if FATCA is not checked? 

Oh no, the worst can happen. Financial institutions can withhold your taxes if the FATCA finds that you don’t meet the documentation requirements.
 

In other words, institutions that are registered under the FATCA Act alert the US tax department at once in the case of a US citizen evading taxes he owes to the government.

Conclusion

That is how serious the FATCA declaration is. At the same time, this is how simple it is if you go according to the steps provided to you.

So, don’t delay, but get your form filled today, and receive the certification as soon as you can and set everything right.

You can then sit back and relax as your pension in the US will be well taken care of for you.

 

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Tata AIA Life Insurance

A joint venture between Tata Sons Pvt. Ltd. and AIA Group Ltd. (AIA),  Tata AIA Life Insurance  is one of the leading life insurance providers in India. We post everything you need to know about life insurance, tax savings and a variety of lateral topics such as savings and investments in this space. You can access and read a host of different blogs, articles and pages at the Tata AIA Life Insurance Knowledge Center or get in touch with us with any queries or questions!

View all posts by Tata AIA Life Insurance

Frequently Asked Questions

Can I submit the form physically to the concerned department?

Yes, if you find the process online hard, you can directly send the form over to the National Pension Scheme.

You can then send the FATCA declaration in the NPS certificate that you receive from the NPS to the Central Recordkeeping Agency (CRA)

What does the TIN stand for?

This is nothing but the taxpayer’s identification number. The Internal Revenue Service makes use of this number to administer tax regulations on US citizens.

Why is FATCA essential for the NPS?

If you fail to submit your FATCA, you could soon have serious problems with your NPS. In other words, your NPS could get blocked, which means you will no longer be able to withdraw funds from your NPS.

Disclaimers

  • Insurance cover is available under the product.
  • The products are underwritten by Tata AIA Life Insurance Company Ltd.
  • The plans are not a guaranteed1 issuance plan, and it will be subject to Company’s underwriting and acceptance.
  • For more details on risk factors, terms and conditions please read sales brochure carefully before concluding a sale.
  • This blog is for information and illustrative purposes only and does not purport to any financial or investment services and do not offer or form part of any offer or recommendation. The information is not and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action.
  • Please know the associated risks and the applicable charges, from your Insurance agent or the Intermediary or policy document issued by the insurance company.
  • Every effort is made to ensure that all information contained in this blog is accurate at the date of publication, however, the Tata AIA Life shall not have any liability for any damages of any kind (including but not limited to errors and omissions) whatsoever relating to this material.