Singapore Tax Rate 2023
Singapore is frequently used as a model for other nations that continue to lower corporate income tax rates and implement various tax incentives to entice and retain foreign investors.
Singapore’s corporate income tax structure is a single-tier, territorial-based flat rate. The city-state of Singapore’s effective tax rates, which are among the lowest in the world, and its general “business friendliness” are the two key drivers of economic growth and foreign investment.
Singapore’s tax rate, capped at 17%, is one of the lowest in the world. And at 0% Capital Gains Tax, you can’t go any lower. Those are two excellent reasons why you should move your funds to Singapore.
In this article, we will be going to discuss in-depth about the Singapore corporate tax rate and tax filing procedures. So, without any further ado, lets begin.
How Does Singapore Corporate Tax Rate Ranks Against Other Jurisdictions?
Personal Income Tax Rates in Singapore 2023
Corporate Taxes, Annual Tax Filings, and Tax Exemptions
| Headline Corporate Tax Rate for Companies in Singapore | 17% |
|---|
Tax Rebates YA 2023
| Income Upto | Percentage on Which You Don’t Need to Pay Tax | Amount Exempt (in SGD) | Amount Taxable (in SGD) |
|---|---|---|---|
| First SGD 10,000 | 75% | 7,500 | 2,500 |
| Next SGD 190,000 | 50% | 95,000 | 95,000 |
| Total Amount Exempt on First SGD 200,000 | 51% | 102,500 | 97,500 |
TAX EXEMPTION SCHEME FOR NEW STARTUPS, YA 2023(APPLICABLE FOR FIRST 3 YAs)
| Income Upto | Percentage on Which You Don’t Need to Pay Tax | Amount Exempt (in SGD) | Amount Taxable (in SGD) |
|---|---|---|---|
| First SGD 100,000 | 75% | 75,000 | 25,000 |
| Next SGD 100,000 | 50% | 50,000 | 50,000 |
| Total Amount Exempt on First SGD 200,000 | 51% | 125,000 | 75,000 |
PARTIAL TAX EXEMPTION SCHEME FOR QUALIFYING COMPANIES YA 2023
| Income Upto | Percentage on Which You Don’t Need to Pay Tax | Amount Exempt (in SGD) | Amount Taxable (in SGD) |
|---|---|---|---|
| First SGD 10,000 | 75% | 7,500 | 2,500 |
| Next SGD 190,000 | 50% | 95,000 | 95,000 |
| Total Amount Exempt on First SGD 200,000 | 51% | 102,500 | 97,500 |
- All income accumulated in or received from Singapore, & all unfamiliar sourced income transmitted to the country. There are tax exemptions for a few qualifying unfamiliar sourced income heads (profits, branch benefits and administration income).
- No capital increases tax in Singapore.
- No saved portion tax on profits.
- No capital obligation, capital acquisitions tax, legacy or bequest tax, or even total assets/abundance tax in the city-state.
- Advance decision on income tax suggestions before a transaction is conceivable.
- No huge limitations on unfamiliar trade transactions and capital developments in Singapore.
- Some limitations exist on lending Singapore Dollars (SGD) to non-local monetary organizations. However, these limitations don’t make a difference to the loaning of SGD to people and non-monetary foundations, including corporate depository residents.
- Internal re-domicile system is accessible in Singapore (unfamiliar substances can move their enrollment to Singapore), accordingly holding their corporate history and markings.
Singapore Corporate tax rates
The highest corporate income tax rate in Singapore is 17%, which is determined based on the organization’s chargeable income. For example, taxable income after deducting permissible costs and losses. However the actual rate is one of the lowest.
The effective tax rate payable becomes even lower due to the full/incomplete exception system where the main SGD 200,000 of chargeable income is accessible for full or halfway exclusion. Further there are plenty of government motivators, endowments and plans to diminish corporate income tax responsibility.
Is Your Company Tax Resident in Singapore
For a company to be tax resident in Singapore it must be controlled and managed from a location within the Republic.
Singapore has Double Tax Agreements (DTA) with 80+ countries. To avoid suffering double taxation, a Singapore tax resident company must obtain a Certificate of Residence (COR). The Inland Revenue Authority Of Singapore (IRAS) will give you a COR if it believes that you have a “fixed place of residence” within Singapore.
What this means is that you have a system of management, an office, or some amount of brick-and-mortar space that is likely to remain in place perpetually, to answer official mails and notices and make decisions that affect the business.
Tax Residency for Foreign-Owned Companies
Where a company is foreign-owned, tax residency depends upon:
- Where the management and control of the business is practiced,
- The place where the company’s executive directors live/have a home, and
- The location of the physical accounting records and reporting documents of the company.
Singapore Corporate tax filing Dates in YA 2023 :
A corporation needs to make two filings with IRAS-
- Estimated Chargeable Income (ECI)
- Form C/Form C-S
The due date for submitting corporate income tax returns ECI is three months of the business’s fiscal year conclusion.
The due date for submitting corporate income tax returns (Form C-S/ C) for Year of Assessment (YA) 2023:
(a)e-filing: December 15, 2023
(b)Paper Filing: November 30, 2023
NOTE: These dates are the same every year. Bear in mind that Singapore companies have between 11 months – if their financial year ends in December, to 22 months – if their financial year ends in January, to prepare and file their returns.
Time frame for Singapore corporate tax filing
- Companies should pay their tax within one month from the date of the Notice of Assessment (NOA). Singapore’s electronic money transfer system, GIRO, is the favoured mode for periodic payment of bills in portions.
- Additionally, companies can appreciate up to 10X minus the interest in regularly scheduled payments when they document their Estimated Chargeable Income electronically inside 90 days from their monetary year end
- At present, around 81% of corporate taxpayers record their tax returns on schedule in Singapore
- its unique work culture,
- and establish a completely local presence.
Annual Tax Filing
File all Annual returns with the Accounting and Corporate Regulatory Authority (ACRA)
Every organization should record its yearly re-visitations of ACRA – the National controller of business activities and the public bookkeeper in Singapore, within one month of its AGM date. Do take note that consolidated returns are not allowed and each organization must record its profits independently.
Annual tax returns to be filed with the IRAS
Tax returns are needed to be recorded by November 30 of the evaluation year for income earned in the accounting year previous to the current one.
Conveying Losses Forward
Companies in Singapore are permitted to convey forward the unabsorbed exchange (rental) misfortunes and capital recompenses resulting in a long time to balance against the income of those years until the exchange misfortunes are completely used.
Conclusion
Singapore has developed into a popular investment destination due in large part to its low tax rate, which is luring investors from all over the world to create businesses there.
If you wish to set up a business in Singapore, you seek assistance from professional experts from OnDemand International to help you under about the Singapore Tax Structure.
FAQ’s
All local and foreign firms registered in the lion city must pay a headline corporate tax rate of 17%, according to the Inland Revenue Authority of Singapore (IRAS).
Corporate tax filing deadlines for businesses are 30 November for paper forms and 15 December for electronic filing, respectively.
There are various helpful policies for those residing and conducting business in Singapore, which is occasionally referred to as a tax haven.
Residents are eligible for a number of personal exemptions and are subject to graduated tax rates that range from 0% to 22%.
Yes, however how much tax you owe will depend on your residency status for tax purposes.
