Australia has signed an inter-governmental agreement with the US to reduce the burden on Australian financial institutions in complying with the Foreign Account Tax Compliance Act.

Australia has signed an inter-governmental agreement with the US to reduce the burden on Australian financial institutions in complying with the Foreign Account Tax Compliance Act.

The agreement, which was signed on Monday, will establish a framework to assist Australian financial institutions in reporting certain financial account information required by FATCA, the Australian government said in a statement.

“The conclusion of this treaty-status IGA will help Australian financial institutions comply with FATCA. It reduces the overall burden on Australian business, minimises costs by simplifying due diligence requirements and broadens arrangements between the Australian Tax Office and the US Internal Revenue Service,”  said Australian treasurer Joe Hockey.

The Australian government will introduce legislation as soon as practicable following a public consultation.