SINGAPORE Law and Practice Contributed by: Lee Woon Shiu and Cheung Kuan Swan (Catherine), DBS Private Bank
has committed to the CRS and has entered into an intergovernmental agreement with the United States to implement FATCA. • Base Erosion and Profit Shifting (BEPS) measures – Singapore has adopted several BEPS-related initiatives, including measures addressing hybrid mismatches, treaty abuse (through the Multilateral Instrument) and Country-by-Country Reporting (CbCR). • Tax audits and investigations – IRAS conducts regular audits and investigations to monitor com - pliance and identify instances of non-compliance. • Voluntary Disclosure Programme – this programme encourages taxpayers to voluntarily disclose past errors or omissions, and typically results in reduced penalties. Through these integrated mechanisms, Singapore demonstrates its ongoing commitment to upholding the integrity of its tax system and promoting interna - Singapore does not publish its own public blacklist of non-cooperative or high risk tax jurisdictions. How - ever, it adheres to international standards developed by organisations such as the OECD Global Forum on Transparency and Exchange of Information for Tax Purposes and the Financial Action Task Force (FATF). Singapore’s tax authorities take these international lists and recommendations into account, and they may inform risk assessment and compliance meas - ures, including enhanced due diligence or reporting obligations for transactions involving entities located in such jurisdictions. While Singapore does not generally impose direct punitive tax measures solely on the basis of dealings with entities from jurisdictions identified as non-coop - erative by international bodies, such transactions are likely to receive heightened scrutiny from the Inland Revenue Authority of Singapore (IRAS). The IRAS typically applies existing anti avoidance provisions, including the General Anti-Avoidance Rule (GAAR) under Section 33 of the Income Tax Act and transfer pricing regulations, with greater rigour to ensure that transactions are genuine, commercially substantive, tional co-operation on tax compliance. 5.3 Blacklists and Non-Cooperative Jurisdictions
and not primarily intended to achieve tax avoidance. In particular, transactions involving entities in low- or no-tax jurisdictions are subject to closer review to pre - vent artificial profit shifting out of Singapore. In addition, Singapore continues to monitor and align itself with international standards and lists issued by bodies such as the OECD and the European Union, particularly in relation to tax transparency and the pre - vention of harmful tax practices. 5.4 Reporting Obligations and Disclosure Regimes Singapore maintains comprehensive reporting and disclosure obligations to promote tax transparency and support compliance. Common Reporting Standard (CRS) As an early adopter of the CRS, Singapore automati - cally exchanges financial account information with partner jurisdictions. Financial institutions are required to report details of accounts held by foreign tax resi - dents to the Inland Revenue Authority of Singapore (IRAS), which then exchanges this information under the CRS framework. Foreign Account Tax Compliance Act (FATCA) Singapore implements FATCA through an Intergovern - mental Agreement (IGA) with the United States. Under this arrangement, Singaporean financial institutions report information on accounts held by US persons to IRAS, which subsequently transmits the relevant data to the US Internal Revenue Service (IRS). Country-by-Country Reporting (CbCR) Multinational enterprise (MNE) groups headquartered in Singapore with annual consolidated revenue of SGD1.125 billion or more are required to file CbCRs with IRAS. These reports provide information on the global allocation of income, taxes paid, and key indi - cators of economic activity across jurisdictions. Annual Tax Returns All taxpayers, including companies, individuals and self employed persons, are required to file annual income tax returns with IRAS. These returns disclose income earned, as well as any deductions, reliefs or exemptions claimed.
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