British banks wary on extra cost of US clients

Onerous obligations on tax currently proposed by US lawmakers could lead to private banks and other financial firms refusing to take on American customers.

The plans, backed by president Barack Obama, would lead to banks in Britain facing higher costs for collecting taxes for the clients, the Daily Telegraph reports.

Under the proposals, the private banking firms would have to complete tax forms for their US customers in order to become a qualified intermediary.

Stockbrokers would also be affected by the move - which is aimed at making sure Americans abroad pay their full tax obligation.

Speaking to the newspaper, an anonymous bank executive commented: ’It’s just about manageable under the current system - and that’s because we’re big.

’The danger to us is suddenly being hauled over the coals by the IRS for a client that hasn’t paid proper taxes. The audit costs will soar.

’We’ll have to pay it but I know plenty of smaller players won’t.’ADNFCR-2318-ID-19185940-ADNFCR