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Seychelles and U.S. tax treaty information

Seychelles is not among the countries on the IRS income tax treaty list. The IRS description of income tax treaties and their saving clause is summarized here as well.

Seychelles in the U.S. treaty list

The IRS A to Z list does not include Seychelles among the countries for which it links to a U.S. income tax treaty.[3]

The IRS says treaty rules can set reduced rates or exemptions for certain income items. It describes treatment for foreign-country residents receiving U.S.-source income, and for U.S. residents or citizens receiving income from foreign sources. The IRS says rates and exemptions vary by country and income item.[3]

The IRS also says that if a treaty does not cover a type of income, or no treaty exists between the United States and the relevant country, the income is taxed under the rates and instructions for the applicable U.S. return.[3]

Seychelles in Treasury's FATCA table

Treasury's FATCA table lists Seychelles with status Signed and identifies Model 1 as its intergovernmental agreement entry.[2]

Treasury explains that FATCA requires foreign financial institutions to report information to the IRS about accounts held by U.S. taxpayers, including accounts held by certain foreign entities with substantial U.S. taxpayer ownership. Treasury says institutions may register directly with the IRS or comply with intergovernmental agreements treated as in effect in their jurisdiction.[2]

Meaning of treaties and information exchange

An income tax treaty is an agreement whose provisions can affect taxation of specified income items across the United States and another country. In the IRS description, the effects include reduced rates or exemptions for the covered items, with the particular treatment varying by country and income type.[3]

An intergovernmental agreement under FATCA is described by Treasury as one route through which foreign financial institutions comply with FATCA. Treasury says FATCA reporting concerns financial accounts held by U.S. taxpayers or certain foreign entities in which U.S. taxpayers have substantial ownership.[2]

Under the Seychelles FATCA arrangement, Seychelles financial institutions provide required information to the Seychelles competent authority, which then forwards it to the U.S. competent authority.[1]

The Seychelles Revenue Commission also describes a broader exchange-of-information network covering 45 jurisdictions, including 28 covered by double taxation conventions and 13 by tax information exchange agreements.

In more detail

Many U.S. states tax income sourced in their states, and some states do not honor tax treaty provisions.[3]

Form 3520 is used to report certain transactions with foreign trusts, ownership of foreign trusts and receipt of certain large foreign gifts or bequests. Transactions with each foreign trust require a separate Form 3520.[5]

Relevance for U.S. citizens

The Form 3520 definition of a U.S. person includes a U.S. citizen or resident, including dual residents who claim income tax treaty benefits.

Related reading

Related information appears in Seychelles information exchange and U.S. trust reporting. Trust types and duration under Seychelles law describes trust arrangements under Seychelles law. Seychelles trust and fiduciary regulation covers local trust and fiduciary regulation. Seychelles trusts for U.S. citizens provides the broader Seychelles trusts reference.

Questions and answers

Does the IRS list a U.S. income tax treaty with Seychelles?

Seychelles does not appear among the country entries in the IRS A to Z treaty list. The IRS provides links to treaties between the United States and particular countries.[3]

What does Treasury list for Seychelles under FATCA?

Treasury lists Seychelles as Signed and gives Model 1 in its FATCA agreements table.[2]

How does Treasury describe FATCA reporting?

Treasury says FATCA requires foreign financial institutions to report account information to the IRS for accounts held by U.S. taxpayers and certain foreign entities with substantial U.S. taxpayer ownership. It describes direct IRS registration and compliance with intergovernmental agreements as routes for institutions.[2]

Related glossary terms

  • Treaty rate table: A treaty rate table summarizes income categories and tax rates or exemptions under U.S. income tax treaties. The IRS explains the tables' scope and limits.
  • Tax residence: Tax residence describes a person's status in a country for tax purposes. Treaty texts address how it affects income items and applicable treaty requirements.
  • Trust: The Hague Convention describes a trust as a relationship in which a settlor places assets under a trustee's control for beneficiaries or a specified purpose.

Related articles and guides

Tools and official documents

  • FATCA agreement lookup: Look up any jurisdiction in the U.S. Treasury FATCA table and see its agreement model and status as the Treasury lists them, with a link to the source.
Sources and data notes
  1. Seychelles Revenue Commission, International Tax. https://src.gov.sc/international-tax/. Retrieved .
  2. U.S. Department of the Treasury, Foreign Account Tax Compliance Act: agreements and understandings by jurisdiction. https://home.treasury.gov/policy-issues/tax-policy/foreign-account-tax-compliance-act. Retrieved .
  3. Internal Revenue Service, United States income tax treaties, A to Z. https://www.irs.gov/businesses/international-businesses/united-states-income-tax-treaties-a-to-z. Retrieved .
  4. Internal Revenue Service, Foreign trust reporting requirements and tax consequences. https://www.irs.gov/businesses/international-businesses/foreign-trust-reporting-requirements-and-tax-consequences. Retrieved .
  5. Internal Revenue Service, Instructions for Form 3520. https://www.irs.gov/instructions/i3520. Retrieved .

Dates in this block record when each source was read for this page.