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For income tax purposes in Singapore, a company is defined as:

1. A business entity incorporated or registered under the Companies Act 1967 or any law enforced in Singapore. It typically includes “Pte Ltd” or “Ltd” in its name.

2. A foreign company registered in Singapore, such as a branch of a foreign company.

3. A foreign company incorporated or registered outside of Singapore.

However, sole-proprietorships or partnership businesses are not classified as companies for income tax purposes.

Basis Period: timeframe during which a company or individual calculates their income for tax purposes. It typically starts from the day a business is set up or the start of the financial year, and it ends on the day before the anniversary of that date. It is generally a 12-month period preceding the YA.

Year of Assessment (YA): specific tax year in which you report your income and pay taxes on the income earned during your basis period. In Singapore, the Year of Assessment for individuals usually follows the calendar year (January 1st to December 31st). For companies, the Year of Assessment may differ and is determined by the company’s financial year-end.

In summary, the basis period is the period for which income is calculated e.g. Year 2020, and the Year of Assessment is the year in which you declare and pay taxes on that income, e.g. Year 2021.

The corporate income tax rate is typically 17% of a company’s chargeable income. This applies to both local and foreign companies. Chargeable income refers to your company’s taxable income (after deducting tax-allowable expenses) for a Year of Assessment (YA).

However, it’s important to note that Singapore has a system of partial tax exemptions and various tax incentives for certain types of companies, which can result in a lower effective tax rate. Small and medium-sized enterprises (SMEs) may enjoy even more favorable tax rates and incentives.

Schedule a meeting with our tax consultants for the most up-to-date information on corporate tax rates and incentives based on your specific circumstances.

It is a declaration of a company’s estimated taxable income to the Inland Revenue Authority of Singapore (IRAS). Companies are required to file their ECI within three months from the end of their financial year, unless they meet certain criteria that exempt them from doing so.

The ECI serves several purposes:

1. Tax Assessment: It helps the IRAS assess and calculate the company’s tax liability for the Year of Assessment (YA).

2. Payment Schedule: It determines the schedule for payment of corporate income taxes, allowing companies to manage their tax obligations effectively.

3. Compliance: Filing an ECI is a legal requirement, and companies failing to do so may incur penalties.

It’s important to note that the ECI is an estimate of the company’s taxable income and not the final tax amount. The final tax liability is determined based on the company’s actual financial statements and other tax adjustments during the tax assessment process.

Our tax consultants can help your company estimate its taxable income for a specific Year of Assessment.

In Singapore, these are different tax filing forms used by companies for reporting their income to the Inland Revenue Authority of Singapore (IRAS):

1. Form C-S (Simplified): This is a simplified tax filing form designed for small companies. Companies eligible for Form C-S must meet specific criteria, including having an annual revenue of up to SGD 5 million and not claiming certain tax incentives. Form C-S is shorter and requires fewer details compared to Form C.

2. Form C-S (Lite): This is an even simpler version of Form C-S, primarily designed for very small companies with straightforward tax situations. It’s meant for companies with annual revenue of up to SGD 200,000. Form C-S (Lite) requires minimal financial information and is the easiest option for small, uncomplicated businesses.

3. Form C: This is the standard tax filing form for companies in Singapore. Companies that don’t meet the eligibility criteria for Form C-S or Form C-S (Lite) must use Form C. It requires a more comprehensive disclosure of financial information and is suitable for larger or more complex businesses.

Companies need to choose the appropriate form based on their eligibility and the complexity of their financial situation. It’s important to note that these forms are used to report income and calculate the corporate income tax liability in Singapore.

In Singapore, the due date for corporate tax e-filing is typically November 30th of the Year of Assessment (YA) for most companies.  However, do keep in mind that each company is required to file an ECI within 3 months of  the end of its financial year.

Please note that tax filing deadlines can vary based on the specific YA and any extensions granted by the Inland Revenue Authority of Singapore (IRAS). Do speak with our tax consultant to confirm the exact due date for a particular tax year.

There is no dividend tax for Singaporean companies. After paying corporate income tax on the company’s profits, the remaining profits can be distributed to shareholders without incurring additional taxation.

Capital gains in Singapore are tax exempt.

Singapore Corporate Tax Exemption Scheme is a tax incentive program designed to reduce the corporate tax burden on eligible companies and it consists of two main components:

• Full Exemption for New Start-Up Companies: Under this component, qualifying companies can enjoy a 75% exemption from corporate income tax on the first SGD 100,000 of normal chargeable income for each of their first three consecutive Years of Assessment (YA). Subsequently, a 50% exemption is granted on the next SGD 100,000 of chargeable income.
• Partial Exemption for All Other Companies: For companies that do not qualify as new start-ups, there is a partial tax exemption. They can receive a 75% exemption on the first SGD 10,000 of normal chargeable income and a 50% exemption on the next SGD 190,000 of chargeable income for each YA.

Please note that tax laws and incentives can change over time. Speak with our tax consultants for the most up-to-date information and eligibility criteria.

Income tax rates depend on an individual’s tax residency status. You will be treated as a tax resident for a particular Year of Assessment (YA) if you are a:

1. Singapore Citizen or Singapore Permanent Resident who resides in Singapore except for temporary absences; or

2. Foreigner who has stayed/worked in Singapore:

a. For at least 183 days in the previous calendar year; or

b. Continuously for 3 consecutive years, even if the period of stay in Singapore may be less than 183 days in the first year and/or third year; or

3. Foreigner who has worked in Singapore for a continuous period straddling 2 calendar years and the total period of stay is at least 183 days*. This applies to employees who entered Singapore but excludes directors of a company, public entertainers, or professionals. 

^{*including your physical presence immediately before and after your employment}

If you do not meet the conditions stated above, you will be treated as a non-resident of Singapore for tax purposes.

Please refer to resident tax rates here.

The tax rate for non-resident individuals is per below.

• Taxes on employment income – flat rate of 15% or the progressive resident tax rate (see table for resident tax rate), whichever is the higher tax amount.
• Taxes on director’s fee, consultation fees and all other income – currently at 22% and will be raised to 24% (w.e.f YA 2024 onwards). It applies to all income including rental income from properties, pension and director’s fees, except employment income and certain income taxable at reduced withholding rates.)

Corppass, or Corporate Pass, is a digital identity authentication and authorization system used in Singapore. It is designed to provide businesses and organizations with a secure way to access various government e-services and perform administrative transactions online.

Your company must first authorize its staff or a third party (e.g. tax agent) in Corppass before they can access the digital services at mytax.iras.gov.sg on behalf of your company.

To setup Corppass, follow the step-by-step guides at corppass.gov.sg

In Singapore, businesses with a taxable turnover exceeding SGD 1 million are required to register for Goods and Services Tax (GST). However, splitting your business into multiple entities with each having a taxable turnover not exceeding SGD 1 million with the intention to avoid GST registration can be seen as an attempt to circumvent tax obligations and may not be allowed.

The Inland Revenue Authority of Singapore (IRAS) may disregard such an arrangement and register your entire businesses for GST with effect from the date you are liable for GST registration. You will then need to account for GST on all past transactions made form that date of registration, even though you may not have collected GST from your customers.

IRAS has guidelines and anti-avoidance measures in place to prevent such arrangements. Attempting to evade GST obligations can result in penalties and legal consequences. Speak to our tax consultants to understand your tax responsibilities and obligations.

To find out, watch this video.

Businesses that plans to register for GST voluntarily must attend this 4-hour course on OVERVIEW OF GST and complete its quiz prior to registering.

Yes, in Singapore, you can claim for pre-registration input tax. Pre-registration input tax refers to the Goods and Services Tax (GST) you’ve paid on business expenses before your company was GST-registered.

You must complete the Pre-registration GST: Checklist for Self-review of Eligibility of claim. You do not need to submit the completed checklist to us but you must maintain it as part of your records.