Common Reporting Standard (CRS)
Updated: Feb 27, 2021
The Common Reporting Standard (CRS) is an internationally recognized standard used to automatically exchange financial account information for tax purposes between various jurisdictions to better combat tax evasion and ensure tax compliance.
The CRS lists the financial account information to be exchanged, the financial institution (FI) that needs to report, the different types of accounts and taxpayers covered, and the customer due diligence procedures that the FI should follow. CRS is built on the basis of the FATCA reporting system to maximize efficiency and reduce the cost of implementing jurisdictions and their FIs.
An entity that becomes a Reporting Singaporean Financial Institution ("SGFI") between 1 January and 31 December (both dates inclusive) of the year is to register for CRS by 31 March of the following year. A failure to comply with this registration requirement is an offence under the CRS Regulations.
All Reporting SGFIs must submit their CRS returns, including nil returns (if applicable) for a reporting year by 31 May of the following year. Reporting SGFIs can select “Return with Nil Data” if they did not maintain any reportable accounts in 2020.
Financial institutions are required to comply with the CRS Regulations. In particular, Reporting SGFIs under the CRS Regulations must:
Register for CRS with IRAS;
Perform due diligence on all Financial Accounts that it maintains; and
Report all Reportable Accounts that it maintains or file a Nil Return (if it does not maintain any Reportable Accounts) to IRAS.
Reporting SGFIs are expected to put in place a robust compliance approach as well as internal policies, procedures and systems that will ensure their effective compliance with the CRS.
If you would like to know more, please contact Bestar.