International Tax
The Seychelles Revenue Commission (SRC) as the competent authority is tasked with the responsibility of ensuring that Seychelles complies with its international tax and financial obligations including the:
- Exchange of Information on Request (“EOIR”);
- Automatic Exchange of Information (AEOI) Common Reporting Standards (CRS) for financial institutions;
- Country by Country (CbCr) Reporting for multinationals under CbC Multilateral Competent Authority Agreement; and
- Foreign Account Tax Compliance Act (FATCA) introduced by the United States (US) in 2010 to reduce tax evasion by its citizens.
The EOIR provides a framework for international exchange of foreseeably relevant information on request for the administration or enforcement of the domestic tax laws of a requesting party. To ensure that the exchange of information functions effectively, there should be administrative measures in place. Once in place and in operations, the EOIR standard provides the foundation for effective international co-operation between tax authorities to tackle offshore tax evasion.
Seychelles at present has an EOI network that covers 45 jurisdictions, 28 covered by a Double Taxation Conventions (DTC), 13 by a Tax Information Exchange Agreements (TIEA). Additionally, Seychelles has also signed the Convention on the Mutual Administrative Assistance in Tax Matters in 2015.
The Global Forum conducts peer reviews to assess the standard of exchange of information on request (EOIR) and to rate the jurisdictions’ compliance. Assessment teams consisting of representatives from Global Forum member jurisdictions and members of the Global Forum Secretariat, carries out systematic examinations and assessments of the jurisdictions’ legal and regulatory frameworks for EOIR as well as the practical application of their frameworks. The objective of the review is to help jurisdictions to effectively implement the international EOIR standard, improve their policymaking, adopt the best practices and comply with established standards and principles.
Four distinct ratings can be allocated to a jurisdiction upon completion of a full peer review as follows:
- Compliant;
- Largely Compliant;
- Partially Compliant;
- Non-Compliant.
Seychelles was rated Largely Compliant in the first supplementary review held in 2015 and Partially Compliant in the second round of the peer review was done in 2019.
| Element | First Round Supplementary Report (2015) | Second Round EOIR Report (2019) | |
| A1 | Availability of Ownership Information | LC | PC |
| A2 | Availability of Accounting Information | LC | NC |
| A3 | Access to Information | C | LC |
| B1 | Access to Information | C | PC |
| B2 | Rights and Safeguards | C | C |
| C1 | EOIR Mechanisms | C | LC |
| C2 | Networks of EOIR Mechanism | C | C |
| C3 | Confidentiality | C | C |
| C4 | Rights and Safeguards | C | C |
| C5 | Quality and Timeless of Responses | LC | PC |
| Overall Rating | LC | PC |
CRS was developed in response to the G20 request and approved by the Organization for Economic Cooperation and Development (OECD) Council on the 15th July, 2014. Jurisdictions are required to obtain information from their financial institutions and automatically exchange that same information with other jurisdictions on an annual basis. Seychelles committed to the first exchange of information in 2017.
- The financial account information to be exchanged.
- The financial institutions required to report.
- The different types of accounts and taxpayers covered.
- The diligence procedures to be followed by financial institutions.
CRS sets out:
The standard for SRC comprises of four key components as follows:
- A model Competent Authority Agreement (CAA), providing the international legal framework for the automatic exchange of CRS information;
- The Common Reporting Standard;
- The Commentaries on the CAA and the CRS; and
- TheCRS XML Schema User Guide.
Due Date for CRS Submissions
The due date for submission is on the 30th June of every year. On a case-by-case basis, the Commissioner General may authorize an extension for the submission of CRS submissions.
Main Obligations of CRS
- As per S.I 1 of 2015, a Reporting Seychelles Financial Institution shall report to the Seychelles Revenue Commission such information as prescribed under Part I of Schedule I in respect of Reportable Accounts maintained by that Reporting Seychelles Financial Institution in a calendar year. The reporting shall be in the form and manner laid down in regulation 5(3).
- An account listed under Schedule 3 is not a Reportable Account for the purposes of these Regulations.
- A Reporting Seychelles Financial Institution shall automatically report to the Seychelles Revenue Commission not later than the 30th June of the year following the end of the previous calendar year in an electronic format following the schema referred to under the Common Reporting Standard by using the e-platform as provided by the Seychelles Revenue Commission.
- Each Reporting Seychelles Financial Institution shall register on the e-platform available on the Seychelles Revenue Commission website and submitting the following information:
- The name of the Reporting Financial Institution;
- The categorization of the Reporting Financial Institution as determined in accordance with these regulations; and
- The full name, address, designation and contact details of the individual authorized by the Reporting Financial Institution to the Reporting Financial Institution’s principal point of contact for all purposes of compliance with these regulations.
- The Revenue Commission shall maintain an up-to-date register of Reporting Seychelles Financial Institutions mentioned in sub regulation (4) (a) and shall make it available for verification to public on demand.
- Any changes to the information under sub regulation 5(4) shall be amended on the e-platform immediately.
- In determining the balance or value of an account denominated in a currency other than US dollars for the purposes of these Regulations, the Reporting Seychelles Financial Institution shall translate the relevant US dollar amount described in Schedule I to these Regulations into the other currency using reference rate (mid-rate) as published by the Central Bank of Seychelles as of the last day of the calendar year preceding the year in which the Reporting Seychelles Financial Institution is determining the balance or value.
- Where the Seychelles Reporting Financial Institution does not identify any reportable account in a particular calendar year, the Seychelles Reporting Financial Institution shall lodge a nil return in the same manner as prescribed under regulation 5(3).
CbCr is part of Action 13 of the Organization for Economic Cooperation and Development (OECD) Base Erosion and Profit Shifting Action Plan (BEPS). The intention of CbCr is to improve transparency for tax administrations by providing them with sufficient information to conduct high-level transfer pricing risk assessments. Seychelles became a signatory of the Multilateral Competent Authority Agreement on the Exchange of Country-By-Country Reports (CbC MCAA ) on 9th July, 2019.
Due Date for CbCr Submissions
The due date for submission is on the 30th June of every year.
On a case-by-case basis, the Commissioner General may authorize an extension for the submission of CRS submissions
The Foreign Account Tax Compliance Act (FATCA) was introduced by the United States (US) in 2010 with the purpose of reducing tax evasion by their citizens FATCA requires financial institutions outside the US to report information on financial accounts held by their US customers to the US Internal Revenue Service (IRS). These requirements are contained in the relevant US Treasury Regulations (US Regulations). The information to be reported by foreign financial institutions is equivalent to that required to be reported by US persons in their US tax returns.
Seychelles signed the agreement with the US for implementation of FATCA and was meant to enact the necessary legislation for financial institutions holding accounts for US citizens to starting reporting in 2020 but due to the Covid-19 pandemic it requested for an extension of time. Under the terms of the agreement, Seychelles Financial Institutions will provide the Seychelles Competent Authority (which is SRC) with the required information. The Seychelles Competent Authority will then forward this information to the US Competent Authority.