4 March 2016

A public consultation on the draft Income Tax (Amendment No. 2) Bill 2016 will be conducted by the Ministry of Finance (MOF) from 1 March 2016 to 18 March 2016.

The proposed amendments to the Income Tax Act (ITA) will allow the implementation of the Common Reporting Standard (CRS) with effect from 1 January 2017. The CRS is an internationally agreed standard for AEOI (a regular exchange of information between jurisdictions for tax purposes, with the objective of detecting and deterring tax evasion by taxpayers), endorsed by OECD and the Global Forum for Transparency and Exchange of Information for Tax Purposes (GF).

A summary of the draft amendments to the ITA is as follows:

• Clarity that existing AEOI provisions in the ITA are applicable to any other AEOI agreement that is in accordance with the CRS, to enable Singapore to sign Competent Authority Agreements (CAAs) with other jurisdictions in implementing AEOI under the CRS.
• Requirement for all FIs collect and retain the CRS information for all non-Singapore-tax-residents, instead of only from tax residents of jurisdictions with which Singapore has a CAA, known as the “Wider Approach”.
• IRAS is vested the necessary powers, which include mandating the electronic filing of returns and information, to implement AEOI under the CRS effectively.

In addition draft regulations, which will be issued by IRAS and the Monetary Authority of Singapore (MAS) by the second quarter of 2016 for public consultation, will include the proposed list of Non-Reporting Financial Institutions and Excluded Accounts, due diligence and reporting requirements for the CRS implementation.

Consultation documents can be found on the MOF website and the REACH consultation portal. Comments can be sent direct to the MOF via the website, email, fax or post.

Source: Ministry of Finance