The UK has signed an agreement alongside the US in order to prevent tax evasion. The agreement is intended to secure information on tax dodgers and share information between the two countries.
The Foreign Account Tax Compliance Act (FATCA) is a US 2010 law made to target people using foreign accounts or foreign entities in which US tax payers hold a stake. Under the agreement, banks will pass on information on account holders through their own governments, rather than directly to the American government.
Many financial institutions are concerned that the agreement could place additional burdens on them, particularly the potential penalties for non-compliance. 30% tax on source-income will be imposed on a financial institution which fails to disclose information to the government.