The Common Reporting Standard (CRS) is an international standard for the automatic exchange of financial information between tax authorities. The CRS was developed in 2014 by the Organisation for Economic Co-operation and Development (OECD) to combat tax evasion and money laundering.
The common reporting basics in Singapore requires financial institutions to report information to their domestic tax authorities, which in turn will exchange the information with the tax authorities of other participating countries. The CRS enables participating countries to better identify and combat offshore tax evasion and money laundering.
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It also helps tax authorities to better understand the financial activities of individuals and companies and to ensure that everyone pays the correct amount of tax. The CRS also makes it easier for individuals and companies to comply with their tax obligations.
It reduces the paperwork requirements and simplifies the process of filing tax returns, as the required information is already reported by the financial institution to the tax authorities. The CRS was implemented from 2017 in all participating countries.
Financial institutions are required to collect and report information such as account numbers, total assets and income, and the name, address and tax identification number of the account holder. The CRS is also applicable to non-financial institutions, such as trusts and foundations. These entities must report information on the settlers, beneficiaries and trustees of the trust or foundation.
The CRS is a powerful tool for combating tax evasion and money laundering. It is also beneficial for individuals and companies as it simplifies the process of complying with their tax obligations. The CRS is now implemented in all participating countries, with financial institutions and non-financial institutions required to report information to their tax authorities.