On or about 29 July 2019, the Inland Revenue Authority of Singapore (IRAS) has published a new Common Reporting Standard (CRS) compliance section on their website stating that Financial Institutions (FIs) must comply with the CRS Regulations in Singapore. Reporting Singaporean Financial Institutions (SGFIs) under the CRS regulations are required to:
- register for CRS with the Inland Revenue Board of Singapore (IRAS)
- perform due diligence on all the maintained financial accounts, and
- report all reportable accounts that it maintains of file a Nil Return to IRAS.
The Common Reporting Standard (CRS) is an internationally agreed standard for the automatic exchange of financial account information between jurisdictions for tax purposes, to better combat tax evasion and ensure tax compliance.
The CRS sets out the financial account information to be exchanged, the financial institutions (“FIs”) required to report, the different types of accounts and taxpayers covered, as well as the customer due diligence procedures to be followed by FIs.
The CRS builds on the FATCA reporting regime to maximise efficiency and reduce costs for implementing jurisdictions and their FIs. Singapore has committed to implement the CRS and the first exchange took place in September 2018.
Reporting SGFIs are required to put in place a robust compliance approach along with internal policies, procedures and systems that ensure their effective compliance with the CRS.
The IRAS plans to assist Reporting SGFIs that are voluntarily compliant to ensure their compliance with CRS.
On the other had, tThe IRAS will take deterrent measures such as issuing warning and imposing penalties for non-compliance.
Source: IRAS website, 29 July 2019