Foreign Account Tax Compliance Act (FATCA)

Foreign Account Tax Compliance Act (FATCA)

The Foreign Account Tax Compliance Act (FATCA), which was passed by U.S., requires that foreign financial Institutions and certain other non-financial foreign entities report on the foreign assets held by their U.S. account holders or be subject to withholding on withholdable payments.

FATCA Registration

Reporting SGFIs can register or update their FATCA classification at the US IRS' FATCA Registration Portal as a "Reporting Financial Institution under a Model 1 IGA" and obtain a Global Intermediary Identification Number (GIIN) from the US IRS to be included in the US IRS' Foreign Financial Institution (FFI) List.

Provision of FATCA Registration Information to IRAS

Reporting SGFIs must provide IRAS with their FATCA Registration Information. A CRS-registered SGFI should submit only the FATCA Registration Information of the entity under the e-Service. Reporting SGFIs that do not provide their FATCA Registration Information will be unable to file their FATCA returns via myTax Portal.

The application will take about 3 weeks to be processed. Once the application is processed, IRAS will send an email to the Point of Contact or individual trustee to inform him/her on the application’s outcome.

FATCA Reporting Requirements

Under the FATCA Regulations, a Reporting SGFI is required to submit an annual return to IRAS setting out the required information in relation to every US Reportable Account that is maintained by the SGFI. Reporting SGFIs that did not maintain any US Reportable Accounts are required to file a nil return to IRAS, by selecting “Return with Nil Data”.

How Bestar can Help

Bestar, a firm specializing in accounting, tax, and advisory services, can assist financial institutions in Singapore with complying with the Foreign Account Tax Compliance Act (FATCA). FATCA is a U.S. law aimed at preventing tax evasion by U.S. taxpayers who hold assets in foreign accounts.   

Bestar can help financial institutions comply with FATCA by:

• Conducting due diligence on account holders: This involves identifying U.S. citizens, residents, and entities that may be subject to FATCA reporting requirements.   

• Registering with the U.S. government: Financial institutions must register with the U.S. government to comply with FATCA. Bestar can assist with this process.   

• Reporting account information to the U.S. government: Financial institutions are required to report information about certain accounts held by U.S. taxpayers to the U.S. government. Bestar can help with this reporting process.   

• Implementing and maintaining FATCA compliance systems: Financial institutions must have systems in place to ensure that they are complying with FATCA. Bestar can help with the design and implementation of these systems.   

Bestar's team of experts has extensive experience in helping financial institutions comply with FATCA. We can provide tailored solutions to meet the specific needs of each client.   

In addition to FATCA compliance, Bestar can also help financial institutions with other regulatory compliance matters, such as anti-money laundering (AML) and know-your-customer (KYC) requirements.   

If you would like to know more, please contact Bestar.

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