Tax and Finance Operate
Elaine Yeo
Ketan Madia
+65 6309-8810
Email: elaine.yeo@sg.ey.com
+65 6540-7098
Email: ketan.madia@sg.ey.com
International Tax and Transaction Services – Transfer Pricing
Luis Coronado, EY Global
Tax Controversy Leader
Stephen Lam
Jonathan Belec
Sharon Tan
Rachel Kok
Vivienne Ong
+65 6309-8826
Email: luis.coronado@sg.ey.com
+65 6309-8305
Email: stephen.lam@sg.ey.com
+65 6309-6175
Email: jonathan.belec@sg.ey.com
+65 6309-6375
Email: sharon.tan@sg.ey.com
+65 6718-1388
Email: rachel.kok@sg.ey.com
+65 6309-6274
Email: vivienne.ong@sg.ey.com
International Tax and Transaction Services – Transaction Tax Advisory
Darryl Kinneally
Sandie Wun
Melissa Siew
Business Tax Services
+65 6309-6800
Email: darryl.kinneally@sg.ey.com
+65 6309-8081
Email: sandie.wun@sg.ey.com
+65 6309-8190
Email: melissa.siew@sg.ey.com
Desmond Teo, +65 6309-6111
Private Client Services
Email: desmond.teo@sg.ey.com
Cedric Tan, +65 6309-8316
Private Client Services
Angela Tan,
Tax Policy and Controversy
Financial Services
Amy Ang, EY Asia-Pacific
Financial Services Tax Leader
Stephen Bruce
Mriganko Mukherjee
Rajesh Bheemanee
Email: cedric.tan@sg.ey.com
+65 6309-8804
Email: angela.tan@sg.ey.com
+65 6309-8347
Email: amy.ang@sg.ey.com
+65 6309-8898
Email: stephen.bruce@sg.ey.com
+65 6309-8013
Email: mriganko.mukherjee@sg.ey.com
+65 6309-8274
Email: rajesh.bheemanee@sg.ey.com
Liza Drew +65 6340-2788
Email: liza.drew@sg.ey.com
May Tay +65 6505-2410
Neha Shah
Mercy Joseph
Tom Toryanik
Desmond Wong
Nandini Navale
Adam Henderson
Tammy Tan
Email: may.tay@sg.ey.com
+65 6309-8016
Email: neha.shah@sg.ey.com
+65 6309-6863
Email: mercy.joseph@sg.ey.com
+65 6540-7268
Email: tom.toryanik@sg.ey.com
+65 6309-8392
Email: desmond.wong@sg.ey.com
+65 6239-4362
Email: nandini.navale@sg.ey.com
+65 6309-6255
Email: adam.henderson@sg.ey.com
+65 6309-8143
Email: tammy-jm.tan@sg.ey.com
Global Compliance and Reporting
Soh Pui Ming
Chai Wai Fook
Chia Seng Chye
Goh Siow Hui
Ivy Ng
Helen Bok
Tan Ching Khee
Teh Swee Thiam
Toh Ai Tee
Toh Shu Hui
Sharon Tia
Hong Shan’er
Chua Xiu Mei
Lim Ting Ting
Olivia Yeoh,
Payroll Operate
Tan Chor Chia,
Accounting Compliance
+65 6309-8215
Email: pui.ming.soh@sg.ey.com
+65 6309-8775
Email: wai-fook.chai@sg.ey.com
+65 6309-8359
Email: seng.chye.chia@sg.ey.com
+65 6309-8333
Email: siow.hui.goh@sg.ey.com
+65 6309-8650
Email: ivy.ng@sg.ey.com
+65 6309-8943
Email: helen.bok@sg.ey.com
+65 6309-8358
Email: ching-khee.tan@sg.ey.com
+65 6309-8770
Email: swee-thiam.teh@sg.ey.com
+65 6309-8486
Email: ai-tee.toh@sg.ey.com
+65 6309-8375
Email: shu-hui.toh@sg.ey.com
+65 6540-7128
Email: sharon.tia@sg.ey.com
+65 6309-8132
Email: shan-er.hong@sg.ey.com
+65 6309-8103
Email: xiu-mei.chua@sg.ey.com
+65 6309-8325
Email: ting-ting.lim@sg.ey.com
+65 6340-2128
Email: olivia.yeoh@sg.ey.com
+65 6039-6465
Email: chor-chia.tan@sg.ey.com and Reporting
People Advisory Services
Panneer Selvam
Kerrie Chang
Lily Cheang
Indirect Tax
Chew Boon Choo
Danny Koh
Monica Sum
A. At a glance
+65 6309-8483
Email: panneer.selvam@sg.ey.com
+65 6309-8341
Email: kerrie.chang@sg.ey.com
+65 6309-8670
Email: lily.cheang@sg.ey.com
+65 6309-8764
Email: boon-choo.chew@sg.ey.com
+65 6309-6101
Email: danny.koh@sg.ey.com
+65 6309-8194
Email: monica.sum@sg.ey.com
during the 2023 basis year is assessed to tax in the 2024 YA. For companies engaged in business in Singapore that adopt an accounting period other than the calendar year, the assessable profits are those for the 12-month accounting period ending in the year preceding the YA.
An estimate of the chargeable income (ECI) of a company must be filed within three months after the end of its accounting year. However, companies are not required to file an ECI if their annual revenue is not more than SGD5 million for the financial year and if their ECI is nil.
The statutory deadline for filing the income tax return is 30 November. No extension of time to file the return is allowed and e-filing is mandatory for all companies.
Income tax is due within one month after the date of issuance of the notice of assessment. In certain circumstances, companies may pay tax in monthly installments on the ECI, up to a maximum of 10, with the first installment payable one month after the end of the accounting period. No installments are allowed if the ECI is submitted more than three months after the end of the relevant accounting period.
A late payment penalty of 5% of the tax due is imposed if the tax is not paid by the due date. If the tax is not paid within 60 days of the imposition of the 5% penalty, an additional penalty of 1% of the tax is levied for each complete month that the tax remains outstanding, up to a maximum of 12%.
Dividends. Dividends paid by a Singapore tax-resident company are exempt from income tax in the hands of shareholders, regardless of whether the dividends are paid out of taxed income or taxfree gains. No withholding tax is imposed on dividends.
Foreign tax relief. Singapore has entered into double tax agreements with more than 90 countries, but notably not with the United States. Under Singapore rules, a foreign tax credit is limited to the lower of the foreign tax paid and the Singapore tax payable on that income. The foreign tax credit (FTC) is granted on a countryby-country, source-by-source basis unless the resident taxpayer elects to claim FTC under the pooling method, subject to meeting certain conditions.
A unilateral tax credit system, similar to FTC relief, is also available for income derived from countries that have not entered into double tax agreements with Singapore.
C. Determination of taxable income
General. In general, book profits reported in the financial statements prepared under the financial reporting standards in Singapore are adjusted in accordance with the Singapore tax rules to arrive at taxable income.
If a company maintains its financial accounts in a functional currency other than Singapore dollars, as required under the financial reporting standards in Singapore, it must furnish tax computations to the IRAS denominated in that functional currency in a manner as prescribed by the law.
For expenses to be deductible, they must meet all of the following conditions:
• They must be incurred wholly and exclusively in the production of income.
• They must be revenue in nature.
• They must not be specifically prohibited under the Singapore tax law.
To facilitate business start-ups, it is specifically provided that a person is treated as having commenced business on the first day of the accounting year in which the business earns its first dollar of business receipt. This is known as the deemed date of commencement, and businesses may deduct revenue expenses incurred in the accounting year (not exceeding a 12-month period) immediately preceding the deemed date of commencement.
Special rules govern the deductibility of expenses for investment holding companies.
Expenses attributable to foreign-source income are not deductible unless the foreign-source income is received in Singapore and subject to tax in Singapore. In general, offshore losses may not be offset against Singapore-source income.
No deduction is allowed for the book depreciation of fixed assets, but tax depreciation (capital allowances) is granted according to statutory rates (see Capital allowances [tax depreciation]).
Double deductions. Double deductions are available for certain expenses relating to approved trade fairs, exhibitions or trade missions, maintenance of overseas trade offices, overseas investment development and approved salary expenditure for employees posted overseas. A sunset clause of 31 December 2025 applies to the double deduction schemes for these expenses.
Renovation or refurbishment deduction. A tax deduction is allowable on due claim, for qualifying renovation or refurbishment (R&R) expenditure incurred for the purposes of a trade, profession or business. The allowable R&R costs are capped at SGD300,000 for every three-year period, beginning with the basis period in which the deduction is first allowed. All businesses will be transitioned to a fixed three-year period with the first three-year period being from the 2025 to 2027 YAs. An option is available to accelerate the deduction of qualifying expenditure incurred on renovation or refurbishment for the 2021, 2022 and 2024 YAs in one YA instead of over three consecutive YAs, subject to an expenditure cap of SGD300,000. This option will continue to be available from 2025 YA onward. Any unused R&R deduction is allowed as a loss carryback or loss carryforward (see Relief for trading losses) or for group relief (see Groups of companies).
Inventories. Trading inventory is normally valued at the lower of cost or net realizable value. Cost must be determined on a firstin, first-out (FIFO) basis; the last-in, first-out (LIFO) basis is not accepted.
Provisions. Under FRS 109 Financial Instruments, impairment losses that represent 12-month expected credit loss (ECL) or lifetime ECL are recognized if some risk of default exists or even
Nature of tax
on business-to-business (B2B) supplies of imported services by way of reverse charge and business-to-consumer (B2C) supplies of imported digital services via the Overseas Vendor Registration (OVR) regime; effective from 1 January 2023, GST is also imposed on the supplies of imported non-digital services and imports of low-value goods; the GST rate increased from 7% to 8% on 1 January 2023, and from 8% to 9% on 1 January 2024 0/9 Social security contributions (Central Provident Fund [CPF]); foreigners holding work passes are exempt
CPF contributions are required on monthly “ordinary wages” from 1 January 2024 to 31 December 2024; the monthly salary ceiling for contributions is SGD6,800 per month for ordinary wages; contributions paid by
Employer (limited to SGD1,156 a month)
17 Employee (limited to SGD1,360 a month) 20 (The above rates are applicable for employees aged 55 and below. Contributions on additional wages, such as bonuses are limited to the total annual wage cap of SGD102,000 less the total ordinary wages for the year. The employer’s and employee’s contribution rate for workers aged from above 55 to 60 is 15% and 16% respectively; lower contribution rates apply to individuals older than age 60. The government has announced that the CPF contribution rates for workers aged 55 to 70 will be gradually increased until 2030. For employees who earn total wages of less than SGD750 per month, different rates apply.)
Skills development levy; payable by employer for all employees working in Singapore; based on the first SGD4,500 of total monthly gross remuneration or subject to a minimum of SGD2, whichever is higher; the maximum levy is SGD11.25 per month. 0.25
E. Miscellaneous matters
Foreign-exchange controls. Singapore does not impose any restrictions on the remittance or repatriation of funds in or out of Singapore.
Debt-to-equity ratios. In general, Singapore does not impose any specific debt-to-equity restrictions.
Anti-avoidance legislation. The domestic tax legislation allows the IRAS to disregard or vary any arrangement that has the purpose or effect of altering the incidence of taxation or reducing or avoiding Singapore tax liability. The IRAS may also tax profits of a nonresident in the name of a resident as if the latter is an agent of the nonresident, if the profits of the resident from
business dealings with the nonresident are viewed as lower than expected as a result of the close connection between the two parties.
The IRAS has introduced a 50% surcharge to be imposed on a taxpayer of the tax assessed on any adjustments that the IRAS has made pursuant to the anti-tax avoidance legislation. This surcharge will apply with effect from the 2023 YA. The Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI) entered into force on 1 April 2019. As of 1 March 2024, Singapore’s tax treaties with 59 jurisdictions have been amended by the MLI.
Transfer pricing. Specific legislation governs the arm’s-length principle to be applied to related-party transactions. The IRAS may make adjustments to the amount of income, deduction or loss of a taxpayer in cases in which the terms of commercial relations or financial relations between two related parties are not at arm’s length. A 5% surcharge is imposed on transferpricing (TP) adjustments made for non-compliance with the arm’s-length principle. A remission on the 5% surcharge may be granted under certain circumstances and subject to conditions.
The Singapore Transfer Pricing Guidelines provide guidance on the arm’s-length principle and TP documentation requirements in Singapore. The guidelines on the application of the arm’s-length principle are broadly consistent with the Organisation for Economic Co-operation and Development (OECD) Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations, which endorse the arm’s-length principle. Specific guidance, including a recommendation to adopt a threestep approach (conduct a comparability analysis, identify the most appropriate TP method and tested party, and determine the arm’s-length results) to apply the arm’s-length principle, is provided together with specific requirements relating to external benchmarking searches and the application of results.
The IRAS expects companies to maintain contemporaneous TP documentation. Effective from the 2019 YA, Singapore taxpayers are required to prepare contemporaneous TP documentation, if certain conditions are satisfied, to support their transactions with related parties, unless specifically exempted. The IRAS does not require TP documentation to be submitted together with the tax returns but taxpayers have 30 days to submit the documents on the IRAS’s request. Failure to prepare contemporaneous documentation or the inability of taxpayers to substantiate transfer prices may result in the imposition of penalties for noncompliance, upward adjustment, ineligibility to invoke competent authority assistance, rejection of an Advance Pricing Arrangement (APA) application and disallowance of self-initiated adjustments. The TP documentation must be organized at the group level and entity level.
TP administration provides information and guidance on the TP audit process and the avoidance and resolution of TP disputes. The TP audit process involves the IRAS selecting taxpayers based on various risk indicators and reviewing and auditing their TP methods and documentation. The guidelines also provide
China Mainland 7/10 (a)(b) 6/10 (p)
Cyprus 7/10 (a)(b) 10 (cc)
Czech Republic 0 0/5/10 (x) Denmark
(a)
(a) 8 (cc)
(a)(c) 10
(a) 8/10 (ll)
(a) 5 (cc) Isle of Man
(cc) Israel
(q)
(a) 15/20 (t)
(a)
(a) 5 (cc) Latvia 0/10 (aa) 5 (cc)
(a) 5 (cc)
(cc)
(cc)
(a)(b)
(u) 0 (u)
(a)(d) 10
(a)(m) 5
(a)(e) 10/15 (j)
(a) 0
(a) 5
(nn)
(a) 7.5 (cc) Norway 7 (a) 7 Oman 7 (a) 8
12.5 (a) 10 Panama 5 (a) 5
Papua New Guinea
10 Philippines 10/15 (a)(r) 15/25 (k)(s) Poland
(a) 2/5 (p) Portugal
(a) 10
(a)
(a) 5
Russian Federation 0 5 (cc) Rwanda 10 (a) 10 (cc)
San Marino 12 (a) 8 (cc)
Saudi Arabia 5 8
Serbia (oo) 10 (a) 5/10 (pp)
Seychelles 12 (a) 8 (cc)
Slovak Republic 0 10
Slovenia 5 (a) 5 (cc)
South Africa 7.5 (a) 5 (cc)
Spain 5 (a) 5 (cc)
Sri Lanka 10 (a) 10 (dd)
Sweden 10/15 (a)(f) 0 (qq)
Switzerland 5 (a) 5 (g)
Taiwan (n) 15
Thailand 10/15 (a)(v) 5/8/10 (y)
Tunisia 5/10 (a)(d) 5/10 (rr) Türkiye 7.5/10 (a)(h) 10
Turkmenistan 10 (a) 10 (cc)
(a) 7.5
United Arab Emirates 0 5 (l)(cc)
United Kingdom 5 (a) 8 (cc) Uruguay 10 (a)(ss) 5/10 (cc)(ee) Uzbekistan 5 8 (cc) Vietnam 10 (a)(tt) 5/10 (o) Non-treaty jurisdictions 15 10
(a) Exempt under certain specified circumstances.
(b) The rate is 7% for interest paid to banks or financial institutions.
(c) The 10% rate applies to interest paid to financial institutions. The 15% rate applies to other interest.
(d) The rate is 5% for interest paid to banks or similar financial institutions..
(e) The rate is 8% for interest paid to banks or financial institutions.
(f) The rate is 10% for interest paid by enterprises engaging in industrial undertakings (manufacturing, assembling and processing, construction, civil engineering and shipbuilding, production of electricity, hydraulic power, gas or the supply or water, or fishing) to financial institutions.
(g) Payments received as consideration for the use of, or the right to use, industrial, commercial or scientific equipment constitute business profits (that is, not royalties).
(h) The rate is 7.5% for interest paid to financial institutions.
(i) In certain circumstances, the reduced rates or exemptions do not apply to royalties for copyrights of literary or artistic works, including cinematographic films and films or tapes for radio or television broadcasting. Reference should be made to the applicable tax treaty.
(j) The 10% rate applies to payments relating to patents, designs or models, plans, secret formulas or processes, or industrial, commercial or scientific equipment or information concerning industrial, commercial or scientific experience. The 15% rate applies in all other cases.
(k) In the case of Singapore, royalties approved under the Economic Expansion Incentives (Relief from Income Tax) Act are exempt.
(l) The term “royalties” excludes royalties with respect to the operation of mines or quarries or the exploitation of natural resources. A contracting state may exempt or reduce the tax on industrial royalties in accordance with its domestic laws.
(m) The 5% rate applies if the interest is received by a bank or financial institution.
(n) The double tax agreement between Singapore and Taiwan does not contain an interest article.