Moving to a new country for work means everything is new and different. Filing US taxes in Singapore being an American citizen is also one difficult experience along with facing many complicated business scenarios. Filing your business US taxes from abroad can be almost impossible, especially if you are unaware of the country’s taxation standards. Thus, when it comes to filing US Expat Singapore, it’s better to learn as much as you can before you move to the country.
To cover the most common loopholes, here are a few important things you should know before you move to Singapore:
When moving abroad, know your eligibility for credits and exclusions
Those expatriates who are moving for the first time don’t realize this, but when living and working in Singapore, as ex-pats, they are required to file US tax Singapore returns timely. As ex-pats, they also qualify for certain exclusions and credits, which make the entire tax filing process a relaxing experience.
Each state has its tax regulations
Many US states continue to collect state tax even after moving to Singapore. It is important to know how your state deals ex-pat matters and then adjust your tax situation accordingly. However, the best way to avoid state taxes, no matter which state you belong to, is to cut all physical ties (bank accounts, mortgages, bills, and many others) before moving to the other country.
Tax filing dates and relevant extensions
Typically, the tax filing deadline in the US is in mid of April every year, normally, it is on 15th April, but if the 15th falls on a weekend or a holiday, the deadline can move to the next available business day. For American expats tax Singapore, the filing deadline is on 15th June and the extension period will be granted until October 15th for certain cases. Noted that extended tax filing deadline does not apply to owed taxes.
Tax treaties prevent double taxation for US expatriates
Income tax treaties help prevent double taxation for Americans living overseas by eliminating US taxes on certain types of income. However, like any legal documentation work, tax treaties can be complex and difficult to understand. If you don’t know which rules applied to your case, be sure to consult a professional accountant in Singapore.
FBAR needs to be filed in particular tax filing cases
FBAR (Foreign Bank Account Report), is part of the US initiative to uncover all the account holders who are hiding money in their offshore accounts. If the aggregate balance of all your foreign bank account exceeds the government stated amount (at present $10,000), you are required to file FBAR. Noted that, FBAR is filed separately from your tax return.
Need to file FATCA
FATCA, Foreign Account Tax Compliance Act is somehow similar to FBAR, which is intended to prevent US taxpayers who are hiding their money in offshore accounts or by purchasing assets. In case, the value of the financial assets exceeds the filing threshold (which may vary by filing status and residency), Form 8938 should be filed. Filing requirements, as well as the procedure of FBAR and FATCA Singapore, are separate, but to a certain extent similar.
These are the few essential things every expatriate should remember when moving abroad for working. Settling the financial and tax issues while working in abroad will allow for a much smoother transaction with no complication. Hiring a US ex-pat tax professional will allow you to truly relax and enjoy your new life.
