Business & Money | Thursday 28 May, 2015 2:03 pm |

KPMG in Saudi Arabia organised a seminar in Riyadh to review the tax compliance obligations on US citizens living in Saudi Arabia. US citizens and Green Card holders, whether they live in the United States or abroad, are required, under US tax law, to file US tax returns and report their worldwide income. Furthernmore, US citizens and Green Card holders are required to disclose to the Internal Revenue Service (”IRS”) inofrmation regarding their foreign bank accounts and certain other foreign assets. It is worth mentioning that the requirements to file US tax returns by US citizens living outside the US existed much earlier before the introduction of FATCA, which was introduced by the US government to ensure that US citizens living abroad are complying with their US tax filing requirements. The introduction of FATCA is expected to impact over 200,000 individuals who are also US citizens, and living in Saudi Arabia..

The seminar was presented by professionals from KPMG with the required expertise and experience in US taxation. The presenters reviewed the categories of individuals who are required to file US tax returns and types of income subject to US tax, including wages, salaries and employment benefits, interest, dividends, income from business activities, rents, royalties, and gains from sale of properties, amongst others. They also explained in detail the US tax exemptions and deductions available to US citizens working and living outside the US, the mechanics of filing US tax returns including filing due dates and the penalties and fines imposed for failure to comply with the US tax filing requirements. The seminar detailed that the deadline for filing US tax returns is generally the 15th of April. However, individuals living outside the US can automatically extend their filing due date to the 15th of June and may also request an additonal extension of time to file to the 15th October. The presenters also reviewed some key figures for 2014-2015, shedding fresh light on the minimum filing requirements, which ranges between $10,000 and $20,000, depending on the individual’s filing status.

At the end of the seminar, KPMG held a press conference in which Rupert Agius-Pease, Head of Tax and Legal services at KPMG in Saudi Arabia, thanked all those who attended the seminar. Then, Rupert Agius-Pease talked about the requirement for US citizens who are associated with or shareholders in foreign corporations or partnerships who may be required to disclose to the IRS certain information about the foreign corporation or partnership. He recomended that US indiviuduals who believe that these requirements may apply to them should consult with their tax advisors to determine if disclosure is necessary and what information needs to be disclosed to aovid any unnecessary penalties or inclusion of income.

Rupert Agius-Pease emphasised the importance to the current voluntary disclosure program being offerd by the IRS to US individuals living outside the US to come forward and comply with their US tax filing requirements in exchange for waiver of certain penalties and interest.

It should be noted that when the voluntary disclosure program was implemented in 2009 the IRS received more than 45,000 voluntary disclosures and collected about US$6.5 billion in taxes, interest and penalties.

In a similar vein, Tareq Abdulrahman Al Sadhan, Managing Partner, in KPMG Saudi, underscored the importance of being aware of the US tax law and the issues of filing tax returns and the unreported foreign accounts. This can safeguard individuals against any failure to comply with these laws. Mr. Al-Sadhan added that these seminars reassure the sustained commitment of KPMG to keep all its clients updated with developing regulatory changes from around the world.