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What’s FATCA and what do I need to do?

FATCA stands for "Foreign Account Tax Compliance Act.” FATCA is a United States law designed to combat tax evasion by US persons (both individuals and entities) that fail to report income related to non-US accounts.

FATCA requires some of PayPal’s non-US subsidiaries to collect information from their account holders to determine whether accounts are held by US persons (individuals or entities) as defined by FATCA.

In order to use PayPal services, non-US PayPal account holders need to complete FATCA requirements by answering a series of questions and possibly provide documentation.

PayPal also reviews existing customer records to make sure that we’ve properly documented their status as a US person or a non-US person for FATCA purposes. Sometimes we may need to request more documentation from a customer in the following situations:

  • If data previously collected about a customer doesn’t match the information in their tax documentation or self-certification.
  • If a customer claims they’re a non-US person, but PayPal finds that US identifiers exist in their information.

Here's how to complete FATCA with PayPal:

  1. On your account Dashboard, click the Notifications icon.
  2. Click the FATCA notification.
  3. Follow the instructions to confirm your tax status and enter the requested information.

Read and review the certification before signing it with your electronic or written signature. False statements may lead to penalties under applicable law. If you have any questions or concerns regarding the form, it may be beneficial to contact a tax advisor.

Agreements between the US and many foreign jurisdictions govern the exchange of account holder information to address local bank secrecy and privacy issues that may be impacted due to the FATCA's requirements. Information shared with the U.S. Internal Revenue Service ("IRS") or local regulatory agencies according to FATCA are also covered by PayPal's Privacy Statement.

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