What is Common Reporting Standard?

  • The Common Reporting Standard (“CRS”) is an internationally agreed standard for automatic exchange of information (“AEOI”) on financial accounts between jurisdictions for tax purposes. The objective is to enhance tax transparency so as to detect and deter tax evasion through the use of offshore bank accounts.
  • More than 100 jurisdictions including major financial centres like Hong Kong, Dubai, Switzerland and Luxembourg will commence the AEOI by 2017 or 2018. Singapore has committed to implement the CRS with the AEOI to take place by September 2018. The amendments to the Singapore Income Tax Act to implement the CRS came into force in July 2016.

What must Police Co-op do?

It must establish the tax residence(s) of all its account holders and report to Inland Revenue Authority of Singapore (IRAS) information of its account holders who are tax residents of jurisdictions where Singapore has an agreement to exchange information with.

How does it affect me?

In compliance with changes to IRAS income tax laws, Police Co-op will have to obtain a self-certification from the account holder (i.e. new membership applicants, new depositors and new joint account holders of the Fixed Deposits Scheme) upon the account opening of all new accounts with effect from 1 January 2017.

A self-certification is a document obtained from an account holder which establishes his/her tax residence status and will include the collection of information including but by no means exhaustive of the following:

  1. Name of account holder
  2. Date of birth
  3. Residence address
  4. Jurisdiction(s) of residence for tax purposes
  5. Tax Identification Number(s)

Do I need to take any action?

Existing members do not have to take any actions unless there is a change in circumstances that affects your tax residency status.

Police Co-op will obtain documentary evidence from our new account holders to confirm the information contained in the self-certification, such as a photocopy of his/her NRIC/employment pass/work permit, passport, tax residence certificate etc.

What is my Tax Identification Number?

For Singapore Citizens or Permanent Residents of Singapore: NRIC number

For Foreign Individuals who work in Singapore and hold a Work Permit or Employment pass: FIN number

How do I know if I am a tax resident?

You will be regarded as a tax resident if you stay or work in Singapore:

  1. For at least 183 days in a calendar year; or
  2. For at least 183 days for a continuous period over two years (applies to foreign employees who have entered Singapore from 1 January 2007 but excludes directors of a company, public entertainers or professionals); or
  3. Continuously for three consecutive years.

Your tax residency status will be reviewed at the point of tax clearance when you cease your employment based on the tax residency rules. If your stay in Singapore is less than 183 days, you will be regarded as a non-resident.

The number of days of employment in Singapore includes weekends and public holidays. Any absences from Singapore that are temporary (e.g. overseas vacation leave) or incidental to your employment (e.g. business trips) are still counted in the total days of employment for the purpose of determining your residency status.

Example 1: If you are in Singapore for at least 183 days in a year – Stayed or worked in Singapore from 1 April 2015 to 3 October 2015

You have stayed or worked in Singapore from 1 April 2015 to 3 October 2015 (186 days). You will be regarded as a tax resident for the Year of Assessment (YA) 2016.

Year of Assessment

Period of Stay (Inclusive of Work) in Singapore

Tax Residency Status
2016 1 April 2015 to 3 October 2015 (186 days) Tax Resident of Singapore

 

Example 2: If you are in Singapore for at least 183 days over two years – Stayed or worked in Singapore from 3 November 2014 to 7 May 2015

Year of Assessment

Period of Stay (Inclusive of Work) in Singapore

Tax Residency Status
2015 3 November 2014 to 31 December 2014 (59 days) Tax Resident of Singapore
2015 1 January 2015 to 7 May 2015 (127 days)
Total number of days in Singapore: 186 days

 

Example 3: If you are in Singapore for three consecutive years – Stayed or worked in Singapore from 3 November 2013 to 7 May 2015

Year of Assessment

Period of Stay (Inclusive of Work) in Singapore

Tax Residency Status
2014 3 November 2013 to 31 December 2013 (59 days) Tax Resident of Singapore
2015 1 January 2014 to 31 December 2014 (365 days)
2016 1 January 2015 to 7 May 2015 (127 days)

The above information has been extracted from IRAS website. Please visit www.iras.gov.sg for more details on Tax Residency matters.

For more information on AEOI, visit http://www.oecd.org/tax/transparency/automaticexchangeofinformation.htm.

For more information on jurisdictions on tax residency, visit http://www.oecd.org/tax/automatic-exchange/crs-implementation-and-assistance/.