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SUTE Only for 1 3YAs from incorporation (not for subsidiary)


Capital Gains/Losses Not taxable/Not deductible
Directors fees not subject to CPF
Directors/Public Entertainers Pay tax regardless of residency

TAXABLE INCOME
TAXABLE BIKs: Accommodation | Home leave passage| Interest
free/subsidized loans | life insurance |paid holidays |childrens
education | gifts>$200| monetary long term service award |
social/recre clubs | gains from assets/stocks sold to employees at
lower price| motor car benefit| tax paid by employer(Tax on tax) |
Excess CPF paid by employer
club subscription fee(provided by employer): not taxable

Home Leave Passage TAXABLE BENEFIT
20% Costs for:
- 1 return trip/year: Employee & Spouse
- 2 return trips/year: Children under 16 or receiving full
time edu at uni or college
ONLY APPLIES T O EXPATS (go back to HOME country)
100% of cost is taxable for remaining trips

Interest Free/Subsidized loans:
Not taxable if o ffered to all employees o n similar terms.
If taxable, Taxable benefit = Current lending rate x Loan


RMB TO APPORTION ACCORDING T O USAGE PERIOD
If driver provided,
Taxable benefit = Annual cost o f driver x (private/total mileage)

Royalties Taxable
Amount Taxable:
Royalty Income Deductible Exp or (Whichever is lower)
10% x Royalty Income
Allowable Rental Exp
Maintenance of p roperty (except renovation, alteration)
Fire insurance premium
Interest on loan borrowed for purchase of property
Property tax, cost of advertising, conservancy
Commission (excld first comm)

DEDUCTIONS [s14 & s15]


Blocked Input T ax is tax deductible except for motor cars.
Non-deductible expenses:
- DADS, Private exp, not wholly&exclusively for acquiring Y,
dividends paid, Improvements, sum recoverable under insurance
or contract of indemnity, rent or repair of p remises not used to
produce Y, income tax p aid, Interest p aid out o f Spore, General
provisions, motor car exp
- OUTPUT GST borne by GST registered trader,
- INPUT GST(can claim but never claim),
if it is a blocked input tax, then input gst is tax d eductible, except
for S-plate.

Deductible Expenses:
Employee salaries, Employee CPF, Medisave ($1500/employee/yr), Medical
expenses, Interest expense, borrowing costs, rent expense, repairs, bad
debts
- Medisave is counted as a medical exp, personal insurance not counted.
Deemed commencement date
First day of accounting year in the immediate preceding year of first $
earned in biz

FOR MEDICAL EXPENSE DEDUCTION (1%/2% of employees remun.)
Add b ack
disallowable
medical exp


Allowances Transport Allowance
Excludes SRS contributions, excess CPF, BIKs

Non Qualifying R&R (Fixtures, Fittings & Installations)
Structural works or expansion of space
Designer fees
Professional fees
Purchase of antiques
Calligraphy or artistic installations that are considered fine art
Display Cabinets
Qualifying R&R
a) general electrical installation and wiring to supply electricity;
(b) general lighting;
(c) h ot/cold water system (pipes, water tanks etc);
(d) gas system;
(e) kitchen fittings (sinks, pipes etc.);
(f) sanitary fittings (toilet bowls, urinals, plumbing, toilet cubicles,
vanity tops, wash basins etc.);
(g) doors, gates and roller shutters (manual or automated)/awnings;
(h) fixed p artitions (glass o r otherwise);
(i) wall coverings (such as wall-paper etc.);
(j) floorings (marble, tiles, laminated wood, parquet etc.);
(k) false ceilings and cornices;
(l) ornamental features or decorations that are not fine art (mirrors,
drawings, pictures, decorative columns etc.);
(m) canopies o r awnings (retractable or non-retractable);
(n) windows (including the grilles etc.);
(o) fitting rooms in retail outlets.
R&R claim over 3 years // Cap at 300k of R&R incurred for 3 yr period

PIC DEDUCTIONS

Ded

CA
Ded
CA

- Leasing of IT & Automated Equipment includes CLOUD COMPUTING
*** Combined cap of 1.2m/1.4m for enhanced deductions+CA
R&D PIC DEDUCTIONS
(Staff costs [excld directors f ees] + consumables + MOF approved payments)
Base Deduction (special deduction)- 100%
S14DA(1) 50% LOCAL // NO CAP
S14DA(2) 250% LOCAL
300% OVERSEAS
CAP AT 1.2m FOR LOCAL+O/S
If R&D outsourced, only 60% of cost will b e subjected to E NHANCED
deductions. Base deduction still 100%.

EMPLOYEE TRAINING PIC DEDUCTIONS


Non-accredited in-house training, PIC deduction cap @ 10k/yr
i.e. total deduction = training exp + 10k x 3

CASH PAYOUT (60% converted to CP)
CI <740735CP , CI > 740735 Dont elect CP, get 400% ded
CP cap @ 100k for conversion per YA for ALL 6 activities
PIC cap will be reduced by portion of C P.
i.e. Convert 100k for CP, new PIC cap = 1.2m 0.1m = 1.1m
FOR ADJUSTMENT, ADD BASE AMT CONVERTED BACK TO N PBT
i.e. Convert 100k, add 100k back to NPBT 60k CP given
PIC BONUS MAX 15K FOR 3 YEARS must incur 5k p.a. for qualifying
PIC expd
FURTHER DED (S14B)

- O verseas business
APPROVED
DONATIONS

development trip/trade
In
cash
fairs/ investment study
- To government, IPC, approved educational trips/ A pproved local trade
institutions
fairs

- 1 00% Enhanced, cap at
In
kind
- Artifact Donations to approved museums 100k per YA

- Computers to prescribed educational, research
or
other
institutions in Singapore and IPC

- Listed shares and unit trusts to IPCs
- Immovable properties to IPCs (Land and Building)
CA // WDA

QUALIFYING P&M

On Hire Purchase (IT & Automated E quipment)


*FULL COST of HP included for 1.2m cap of enhanced CA
even though CA still based on principle amount.
i.e. 1120k(HP), 30k, 50k, 70k; Enhanced CA
cap=1120+30+50=1200
No Enhanced CA for the 70k (only base CA)
- HP amt for CA includes d eposit, excludes interest

IPR (WDA)
Only for companies/partnership SP not allowed
Claim o ver 5 consecutive years

TAX CHARGE ON CA/WDA
Tax charge on BASE CA/WDA
Sold off between Yr 1 and Yr 5
Gain from sale of d isposal (BC) added to NPBT
Tax charge on ENHANCED CA/WDA
Sold off within ONE year
BC + Total CA/WDA previously claimed added to NPBT

CASH PAYOUT (60% converted to CP)
CP cap at 100K per YA for ALL 6 activities
-Reduces cap by amount converted
Full amount must be converted to CP for:
- PIC IT & Automated Equipment
- IPR (except in-licensing)
- Registration o f IPR
Excess amt forfeited

C/F, GROUP RELIEF, C/B
SST shareholders and their respective shareholdings
must remain substantially (50 % o r more) the same as at
the relevant dates // 50% shares h eld by same p ersons

C/F Relevant Dates
Subject to SST
UCA & UTL c/f for unlimited periods, while UD can only c/f
5 years

Last day of
First day of
UCA
YA that CA arose
YA that CA utilized
UTL/D
Year TL/Don arose
YA TL/Don Utilized
Shares held by another coy deemed to be held b y
shareholders of that company
GROUP RELIEF
QD: Only CURRENT YEAR CA/TL/Don can b e transferred
Those from prior years that still cnt be offset C/F
SG i ncorporated coy
75% ordinary shareholding at the end of BP (last day)
TYPE 1: 75% (directly or indirectly) o f S held by P
TYPE 2: 75% in each of the 2 Ss held by P (dir/indir), S
can transfer between each other
If shareholding fall below 75% during the year:
- Pro-rate QD relating to continuous period (use mths)
- Lower o f pro-rated QD of Transferor or pro-rated AI of
Claimant
- Excess QD c/f by transferor
Same Accounting Y/E
C/B RELIEF
- SST + Only can c/b 1 year
- Only UCA & UTL can be c/b, UD CANNOT be c/b
- Lower o f 100k or AI of claimant





Motor car Cant claim CA
QUALIFYING P&M EXPD
Delivery and installation costs/ Alterations to an existing building
incidental to installation/Removing of old P&M and reinstalling new
P&M/COE & registration fees of commercial vehicles

BALANCING ADJUSTMENTS
When Selling P. > I nitial
Sales Proceeds-TWDV < 0 (BA) Include as CA cost, BC = CA claimed
Sales Proceeds-TWDV > 0 (BC) Adds to taxable n on-trade income
***BC capped at CA already claimed (granted)
Sales proceeds: SALE, INSURANCE, SALVAGE VALUE, COMPENSATION
RECEIVED, OPEN MKT VALUE

REPLACEMENT OF P&M Election of s21
- Set-off BC of old P&M from disposal against, cost of new P&M
SALES BETWEEN ASSOCIATED PERSONS Election of s24
- Buyer takes o ver asset at TWDV
- No BA/BC for seller
- Buyers CA is the same as Sellers i.e. Seller CA = 50k/yr, Buyer CA =
50k/yr
PIC IT & AUTOMATED EQUIPMENT (CA) enhanced C A
- Image or graphics processing equipment, including facsimile, optical
character reader, laser printer, plotter, image setter, digital p rinting
and direct imaging equipment
- Automated machine, etc
- Computer e.g. Computer controlled machine etc [1 year under
s19A(2)]
- Website development wef YA2014 [1 year u nder s19A(10)]
- Robot, including assembly robots, robotic systems and auto-packing
lines.
- Software
Must have one year ownership period to claim ENHANCED CA (can
still claim base)

Tax Computation for a company:


Net Profit Per A /cs Before Tax
Less: Non-trade Income
Non-biz Income (Int/Dvds/Rental)
Gain o n Disposal

Capital Receipts (eg. sale of P&M)
Exempt Income (Sgp d vd, REITS)
Foreign Income N ot Remitted




Add: Non-trade Income related exp
Less: Non taxable income (capt gains)
Add: Exp related to non-taxable income
Add: Non-deductible Exp
Sections 14&15

DADS


General Provisions

Capital E xpd (not allowed under s15)
Motor car E xp

Forex gain/loss (non-trade)




Less: Further Deductions
Further Deductions (S14B, S14E)
Special Deductions (S14DA, S14Q)
PIC (300% enhanced deduction)
Add: PIC C P (Base amount)

S10(1)(a) ADJUSTED PROFITS


Less: Capital Allowances (including BA)
Less: T rade Losses (B/F or current yr)
Less: Approved Donations(B/F or current yr)
Add: Taxable Non-trade Income
Interest/Divd/Rental *include BC
Less: Related Exp (taxable non trade Y)
Add: PIC BONUS (up to 15k)





ASSESSABLE INCOME

Less: Investment Allowances

Less: Group Relief Claim (if have)
Less: Loss C/B Relief Claim (if have)
CHARGEABLE INCOME
Less: Partial Tax Exemption (if have):
- 75% of $10K; 50% of max $290K
Tax payable @ 17%

Less: CIT rebate @30%; max $30K per YA)
Net Tax Payable



Bad Debt
- Are deductible if:
- Debt arising from trade
- Included in trading receipts (related to
credit sales taken up in i/s Acct rec)
- Doubtful debts taken to be irrevocable
- Sums recovered are taxable (only if arise
from trade ^)

1. Advance payment to supplier (prepayment),
not included in trading receipts Not
deductible ADD BACK
2. Cash received from an ex-employee who
defaulted on a loan earlier Not taxable
MINUS OFF (not from trade)
3. Trade debt taken o ver from another b iz
Not ded.

PERSONAL RELIEFS
Loss transferred from spouse deducted after earned income.
EARNED INCOME = Trade Y + Employment Y + Pension/Royalty Y CA - TL
STATUTORY INCOME = Trade Y + Employment Y + Others(Rental Y/SRS) - CA TL
Full & Salaried partner salary Trade Y

Reliefs
Earned Y (EI)
CPF Relief
Spouse Relief
QCR/HCR
WMCR (EI)
GCR (EI)
Dependants
Handicap Sib
NS Man

FML Relief
(EI)
Course Fee R.
Life
Insurance
Relief

MSTU Relief
(CPF)

SRS Relief

Compulsory
Medisave
Voluntary
CPF &
Medisave
Relief

Sleeping partner Y U nearned income

Conditions
Relief capped at amt of EI
Amt o f relief: Actual CPF contribution; Max C PF Relief = 17k
Spouse Y 4k p.a. (includes exempt Y i.e. Interest Y )
Child Y 4k p.a/ Child need not b e SGrean
Child Y 4k p.a/ Child: SGrean; only for women
Only for women/ Child: SGrean, 12yrs; Claim for only one Gp
No income limit
Dependants Y 4k; Dependants: 55yrs; Claim for up to 2 Dep.
Handicap no Y limit of 4k
Live in sg + Living under same Household or incur 2k
Parents can o nly claim for ONE son (in total)//Wife or parent
must be SGrean
rd
2x FML on one maid; Concession for max 2 maids i.e. 3 maid
$265 per month; o nly for women
w/o concession Relief = 6360/year (265 x 2 x 12mths)
with concession Relief = 2880/year (120 x 2 x 12mths)
Relief apportioned to the no. of months
Cap @ $5500/year
CPF Relief must be < 5k p.a. (i.e. max income 25k) Retirees/Expats
can claim no
Amt o f Relief is LOWEST OF:
CPF contr.
a)
Actual premium paid
b)
7% of capital sum payable on death
c)
diff between 5k and CPF relief
1) Employer top-up E mployees CPF
Employee: Not tax deductible, but given personal relief(7k
Cap pa)
2) Top up C PF of spouse/sibling (Y 4k p.a.)
/parents/grandparents (no Y limit)
Tax relief cap @ 7k pa or actual paymt (can be apportioned)
Employers SRS contribution to your acct Taxable, but given
relief
Amount of relief: Actual contribution made
Max SRS Contribution (p.a.) Sgrean/PR: $12,750
- Foreigner: $29,750
For Self-employed persons.
Relief capped at lowest of:
a)
Compulsory contribution (According to table)
b)
Actual Contribution
c)
Max Contribution (according to table)
Total relief capped at 30.6k (refer to tables below)


COMPULSORY MEDISAVE CONTRIBUTION (rates)


RELIEFS GIVEN
VOLUNTARY CPF Contribution
LOWEST OF:
a) Actual contribution
b) 36% of NET TRADE INCOME
c) $30,600 Mandatory
CPF/Medisave contributions

VOLUNTARY Medisave Contribution


LOWEST OF:
a) Actual Contribution
b) $30,600 - Mandatory CPF/Medisave
contributions
c) $48,500 Bal in MA before voluntary
contribution
NET TRADE INCOME = TRADE Y - ALLOWABLE BIZ EXP - CA - TL
Mandatory CPF contr. = 36% of $$ subject to CPF (OW + AW)[only employment
Y]
% Depends on age. i.e. 55yrs (13%+10.5%) x $$ subject to CPF
Mandatory Medisave contr: refer to table abv

REBATE FOR CHILDREN OF FAMILY (child must be SGrean)


Given only once a year when child is is born/adopted/upon
marriage (step child)
Unutilized rebate can be c/f to offset future tax payable


PARTNERSHIPS


CA/Donations allocated according to profit sharing ratio
CA/Donations claimed on indiv tax computation
- Interest exp on loan from partner DEDUCTIBLE (do nth)
- Medical benefit from partnership TAXABLE on partner

NON-RESIDENTS
Interest payments/other related exp to NON RESIDENTS, not
tax deductible (add b ack)

S12(6) DEEMED SOURCED IN SG
Interest, commission, fees and any other payment in
connection with loan or indebtedness UNLESS:
- Payment for loan for biz carried on outside SG through PE
outside SG
- Payment for loan for immovable property outside SG

S12(6A) Exclusion Not Deemed Source i n SG
1. Payment for arrangement/management/service relating to
loan or indebtedness that is performed outside SG
2) Payment for any guarantee to any loan or indebtedness,
where guarantee provided
for or on behalf o f person resident in SG or PE in SG by
specified NR person.

SPECIFIED NR PERSON
1. Must be a COMPANY NOT incorporated in SG
2. Does not carry o n a biz in SG by himself or in associated w
others
3. If he carries on biz in SG or has PE in SG, specified services
must NOT be performed through that biz/PE

S12(7) DEEMED SOURCED IN SG
1. Payment for a/b/c/d borne directly or indirectly by person
resident in SG or PE in SG
2. Payment that is deductible against income derived from SG
S12(7)
Rate
Nature o f Income
(a)
10%
Royalty
(b)
10%
Know How use of/right to use
scientific, technical industrial or
commercial knowledge/info
17%
Show How (Incld Cloud Computing)
(c)
17%
Management Fees (admin, financial
services, marketing)
(d)
15%
Rental of movable properties
Technical service/ Installation / Training Service Show How
Only NR Coy w N ON FINAL tax (17%) entitled to PTE (i.e.
know how, royalty)

ROYALTY
Payer granted the right to commercially exploit the copyright
or licensing for copyright exploitation
NOT ROYALTY if
1. Transfer of o wnership of distinct and specified property
e.g. Acquisition of technology Capital item
2. Right to use the software/digitalized goods for personal use
or for use within business operations i.e. n o right to exploit

S12(7A) EXCLUSIONS NOT DEEMED SOURCED IN SG
1. Payment for rendering assistance/service [12(7)b] or
management/assistance in management p erformed outside SG
for or on behalf o f person resident in SG or PE in SG by specified
NR person.
2. The use of or the right to u se software, information or
digitised goods, not being a right to commercially exploit in
one form or another the copyright in such software/
information/digitised goods such as the right to
(i) reproduce, modify or adapt, and d istribute the software,
information o r digitised goods; or
(ii) prepare a derivative work b ased on the software,
information o r digitised goods for distribution.
NO W ITHHOLDING TAX on PEs that are SG branches of NR coy

40C Relief


Tax Rates of NON-RESIDENT EMPLOYEES


*For calc of tax using resident rate, treat income as from
resident. i.e. W hat is the tax p ayable aft Personal Reliefs given?

NON-RESIDENT PROFESSIONALS (WTH 15% gross/ 20% net)
Gross Y - Accommodation, airfare, allowances, per diem,
transport and meals
*Private expenses incurred (transport, food, airport transfer)
ND / if private exp are provided, they are taxable


NON-RESIDENT PUBLIC ENTERTAINERS (WHT 10%) (40A relief)
Gross Y - Fees, Allowances, Food, Airfare, Accommodation
*Expenses incurred by entertainer for p dtn of Y is deductible
- 60 day rule dont apply. A LWAYS have to pay tax

FOR NON FINAL TAXES


1) Compute the with h olding tax
2) Compute the actual taxes to b e paid by NR
i.e. N PBT exp = CI // CI PTE ----> Actual Tax Payable
3) Reimburse the resident coy the extra tax withheld
- Only NR Coy w N ON FINAL tax (17%) entitled to PTE

PAYMENT OF WITH HOLDING TAX
th
nd
15 of the 2 month following date of payment
Date of Payment (earliest o f):
1. Actual date of payment
2. Payment d ate on contract (or date on invoice)
3. Date p ayment was credited to NRs account
LATE PAYMENT PENALTIES
- 5% of with h olding tax amount for first month
st
- 1% for every complete month (if not paid aft 1 30
days) Max 15%
- Max Total Penalty = 20%

GST

1. PLACE OF SUPPLY OF GOODS AND SERVICES
Start location determines place o f supply
End location determines GST rate
2. TYPE OF SUPPLIES
Out of Scope Supplies (no gst)
rd
- Sale of property o utside SG, 3 Country Sale (gds
delivered from place o utside SG to place o utside SG),
Transfer of (whole) business as a going concern
- DO NOT report in GST return

Exempt Supplies
- Sales and lease of residential properties, Provision of
financial services (sale of shares/bonds), Supply o f
investment previous metals
- Input tax incurred to make supply is N OT recoverable,
No output tax
- NEED TO report on GST return

PARTIAL EXEMPTION for exempt supplies
- Input tax i ncurred in making exempt supplies is not
claimable. Can claim if satisfy De Minimis Rule:
If total value of exempt supplies:
$40 000 p er month and
5 % of total supplies (taxable and exempt)

Zero rated Supply 0% Sg Overseas
- Exportation o f Goods
- International services in s21(3) (transportation o f
passengers/goods)
-Input tax incurred to make supply recoverable

Standard-rated supply 7% Sg Sg
All other goods and services (local supply) including sale
of capital asset
-Input tax recoverable

GST REGISTRATION
Retrospective Test
- Applies on 31 Mar, 30 Jun, 30 Sept, 31 Dec
- Total value o f taxable supplies* for current quarter &
last 3 quarters > $1m

Prospective Test
- Total value o f taxable supplies* expected for next 12
months > $1m
- Biz can reasonably expect so (contractual agreement)
*Taxable supplies exclude sale of capital assets

Payment and filing of GST returns 1 month after end
of p rescribed accounting period

Costs to GST T rader:
1) Depends on Customer
2) If b locked input tax (cannot claim)
3) Cant claim input tax incurred to make exempt sup
4) If GST trader absorbs GST (have to pay to comtroller)








Deadlines for Submissions:
Estimate Chargeable Income submitted 3 mths aft acct
Y/E.
Form C has to be submitted by 31/Jul or latest 30/Nov
regardless of year end
Form B, M, P, P1, T has to be submitted by 15/4 of YA, but
can ask for extension.
Notice of assessment (NOA) issued when tax is due. Pay
within 1 mth of the NOA, else late penalties will apply. NOA
becomes final and conclusive if no objection is received by
the Comptroller within the 30 days
NOA p. 398 of ITA 4 types 1. Original 2. Additional (more
tax to pay) 3. Amended (Less tax to pay) 4. Advance (given
to expats leaving the country)
S93(3) Final & conclusive NOA can be amended if there is
claim for error or mistake. S93(A) However, the claim must
be made before the end of 6 years (before YA 08) or within
4 years from end of the year in which assessment was made.
Comptroller may accept a late objection if there are
reasonable grounds for it.
Instalment Payments of Tax can be done if you start paying
tax less than 2 months after y/e. If right after y/e, 10
instalments. If 1 month later, 8 instalments. If 2 months later,
6 instalments. To do so, you need to submit ECI 2 months
before due date.
s87 Late payment penalties apply if you do not pay tax 1
month after NOA, 5% penalty will be imposed immediately
on tax that is not paid. You still do not pay within 60 days of
the penalty, an additional 1%(2% for GST) penalty each
complete month will be imposed, up to 15 months (15%).
Max 17% total
For employees leaving Singapore, employer required to
W/H all money due. Only payable on the earlier of 1)
expiration of IR21 or 2) tax clearance.
If you have any objections, should pay first and argue later,
to avoid penalty. The objection must be filed within 30 days
from the date of issue of the assignment. The objection must
be in writing and his grounds of objection must be stated.
It is also possible to apply for a stand over to pay an amt
lower thn total amt. However, if the final tax liability agreed
is higher than the stand over amount, late penalties will apply
frm due date of paymnt of the amt.
If a taxpayer is unable to agree with the Comptroller on
the amount of tax payable, A Notice of Refusal to Amend
should be obtained from the Comptroller. A notice of appeal
should be lodged with the Board of Review within 7 days frm
the date of issue of the Notice of Refusal to Amend. A
petition of appeal, stating the grounds of appeal, should then
be lodged within 30 days from the notice of appeal. Onus is
on the taxpayer to show that the assessment is excessive. The
decision of the Board of Review is final where no question of
law is involved.
The taxpayer may proceed with his appeal to the High Court
only if the issue concerns a question of law or a question of
mixed law and fact and the disputed tax exceeds $200.
Summary of offences with penalties are
1) Non-compliance(S94) or Obstruction(S98) - $1000 fine/6
months jail (if default fine) 2) Incorrect return w reasonable
excuse (S95(2)) just pay up the tax
3) Incorrect return due to negligence or no reasonable excuse
(S95(2)) - $5000 fine, 3 years jail & 200% penalty. If
disclose everything, can negotiate 200%. 4) Evasion (S96(1))
- $10,000 fine, 3 years jail & 300% penalty. 5) Serious
evasion (S96A) - $50,000 fine , 5 years jail and 400%
penalty. 6) Tax officers & purported tax officers (S97) $10,000 fine & 3 years jail