24 March 2015
The Singapore-US Foreign Account Tax Compliance Act (FATCA) Model 1 Intergovernmental Agreement (IGA) and Regulations has entered into force on 18 March 2015.
On 5 May 2014, Singapore had initialled an IGA with the US that will facilitate compliance with the US FATCA by Singapore-based Financial Institutions (SGFIs). SGFIs are required to report account information of US persons to the Inland Revenue Authority of Singapore (IRAS) who will in turn share this information with the US IRS. The IGA was signed on 9 December 2014.
The e-Tax Guide, “Compliance Requirements of the Singapore-US Intergovernmental Agreement on Foreign Account Tax Compliance Act” issued by IRAS on 17 March 2015 outlines the main aspects of the due diligence and reporting requirements under the Agreement.
Financial institutions that fail to comply will face a 30% FATCA-related withholding tax on certain payments made from the US to them.