On or about 23 Feb 2022, the Inland Revenue Authority of Singapore (IRAS) has updated to FAQs on the Foreign Account Tax Compliance Act (FATCA), and published the fourth edition of IRAS User Guide : IRAS Supplementary XML Schema User Guide for Preparing the FATCA Reporting Data File. It replaces the third edition published on 1 Apr 2021 & 13 Apr 2021.
FATCA is a U.S. law which requires all financial institutions (FIs) outside of the U.S. (also known as Foreign Financial
Institutions, or FFIs) to regularly submit information on financial accounts held by U.S. persons to the U.S. Internal Revenue
Service (U.S. IRS).
The U.S.’ intent of FATCA is to deter and detect U.S. tax evasion through the use of foreign financial accounts. Failure to comply with the reporting obligations under FATCA will result in the U.S. Government imposing a 30% withholding tax on certain gross payments made from the U.S. to non-compliant FFIs.
The update to IRAS FAQ on the FATCA has added FAQ B.7 to clarify how a Reporting SGFI should report TINs of Foreign Entity Account Holders (where Entity Account Holder is not a U.S. Person such as in the case of a Passive NFFE)
This Supplementary Guide provides additional guidance on how the information for certain data elements (e.g. MessageRefId and DocRefId) must be presented for the purpose of FATCA reporting to IRAS via myTax Portal. This Supplementary Guide should be read in conjunction with the FATCA Regulations, FATCA guidance materials and the FATCA XML Schema V2.0 User Guide (U.S. IRS’ Publication 5124).
The amendments to this Supplementary Guide was on paragraph 7.3 to provide clarification on populating foreign TIN
for Entity Account Holder that is not a U.S. Person.