The Inland Revenue Authority of Singapore (the “IRAS”) has updated its webpage on the Foreign Account Tax Compliance Act (the “FATCA”) in relation to the date extension for the FATCA filing deadline for reporting year 2014.
The Income Tax (International Tax Compliance Agreements) (United States of America) Regulations 2015 requires Reporting Singapore-based financial institution (“SGFIs”) to submit a return setting out the required information in relation to every US reportable account it maintains (i.e. the FATCA reporting data) on or before 31 May of the year following the calendar year to which the return relates. For Reporting Year 2014 only, the IRAS is extending the filing deadline for Reporting SGFIs to submit their FATCA reporting data to 31 July 2015.
A Reporting SGFI that does not maintain any US Reportable Account for Reporting Year 2014 must provide a nil return by either (i) preparing a FATCA reporting packet and transmitting it through the International Data Exchange Service (IDES), or (ii) completing a paper FATCA Nil Return (which will be made available at a later date) and mailing it to the IRAS by 31 July 2015.
By way of background, the US Congress enacted the FATCA in March 2010 to target non-compliance with US tax laws by US persons using foreign accounts.
The FATCA affects financial institutions worldwide and requires those outside of the US to submit information on financial accounts held by US persons to the US Internal Revenue Service (IRS) on a regular basis. Financial institutions that fail to comply will face a 30% FATCA-related withholding tax on certain payments made from the US to them.
On 9 December 2014, Singapore and the US signed an Intergovernmental Agreement (“IGA”) that will facilitate compliance with the FATCA by SGFIs. The IGA took effect from 18 March 2015.
An article about the IGA was featured in a previous issue of the Allen & Gledhill Financial Services Bulletin (March 2015). To read the article entitled “FATCA Singapore-US IGA enters into force on 18 March 2015”, please click here.