ACCOUNTING

More Than 100 Jurisdictions, Including Hong Kong, Singapore Commit to Implementing the CRS

Under the Common Reporting Standard (CRS), which has been in effect since 1 January 2017, Singapore-based Financial Institutions (SGFIs) – depository institutions such as banks, specified insurance companies, investment entities and custodial institutions – are now required to establish the tax residency status of all their account holders, and report to IRAS, the financial account information of account holders who are tax residents of jurisdictions with which Singapore has a Competent Authority Agreement (CAA) to exchange the information.

All account holders of SGFIs, when requested by their respective FIs, should provide their FIs with information and supporting documents to establish their tax residency status.

For accounts opened before 1 January 2017, FIs may contact the account holders to confirm their tax residency status if the FIs hold information that indicates they could be foreign tax residents. For new accounts opened on or after 1 January 2017, FIs will use a self-certification form, to be filled in by account holders, to collect tax residency information.

It is important that account holders cooperate fully with their FIs when approached. If the account holders do not respond to their FIs’ requests to confirm their tax residency status, the FIs will have to treat the account holders as tax residents in the respective foreign jurisdictions, based on the information available to the FIs.

Account holders should also inform their FIs of any change in circumstances, such as long-term job postings to a foreign jurisdiction, which may affect their tax residency status.

Account holders are also reminded to ensure that all submissions to FIs are accurate. Deliberately providing false information to the FIs on an account holder’s tax residency status is an offense under the CRS law.

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