Inland Revenue Authority of Singapore

If you’ve ever paid taxes in Singapore, you would have received communication from the Inland Revenue Authority of Singapore (IRAS). IRAS is the tax collector for the Government of Singapore, and all tax-related regulations of the island-nation are handled by them.

What is IRAS and what does it do?

IRAS was created in 1947 as the Singapore Income Tax Department. It began evaluating and collecting tax in November 1948. The Inland Revenue Department was created in 1960 when Singapore became a self-governing nation.

The Inland Revenue Authority of Singapore was set up by legislation in 1992 as a statutory board under the Ministry of Finance. The incorporation of the organisation was performed through the Inland Revenue Authority of Singapore Act and effectively replaced the earlier Inland Revenue Department.

IRAS functions not only as a tax collector and administrator, but also as a tax advisor to the government of Singapore. IRAS also represents Singapore in all tax matters of globally. IRAS assesses and collects all kind of taxes in Singapore, including income tax, property tax, and goods and services tax (GST). It helps provide most of the operational costs of the government. The government’s operating revenue is mainly derived from taxes (85.8%), fees and charges, and other earnings.

Taxes covered by IRAS

The IRAS is responsible for handling the following Acts and the taxes associated with them:

  1. Income Tax Act – Income tax
  2. Economic Expansion Incentives (Relief from Income Tax) Act
  3. Estate Duty Act – Estate duty
  4. Stamp Duties Act – Stamp duty
  5. Goods & Services Tax Act – GST
  6. Property Tax Act – Property tax
  7. Casino Control Act – Casino tax
  8. Betting and Sweepstakes Duties Act – Betting tax
  9. Private Lotteries Act – Betting tax

Other taxes such as Foreign Worker Levy, Airport Passenger Service Charge, Motor Vehicle Tax, Customs Duty and Excise Duty are not under the purview of IRAS. They are managed by the relevant departments of the government.

Tax system in Singapore

The main purposes of tax collection in Singapore are:

  1. To bring in revenue for the government
  2. To further the socio-economic goals of the country

IRAS aims to have a reasonable taxation regime for both individuals and companies. This way, Singaporeans and permanent residents are not bogged down by tax liabilities, and local entrepreneurship, productivity and employment creation thrives. The competitive tax system is also designed to encourage foreign companies and individuals to invest in Singaporean ventures.

The tax rates and rules are differentiated according to the tax type and entities under each type. The categorisation is done as given below:

For Income Tax:

  • Singapore citizens and permanent residents
  • Foreigners (tax residents and non-tax residents)
  • Companies (including self-employed persons, sole proprietors and partners)

For GST:

  • GST-Registered businesses
  • Non GST-Registered businesses
  • Consumers

For Property Tax:

  • Property owners

Other Miscellaneous Taxes

Each entity has to pay taxes as per the regulations laid out for them alone, and do not need to concern themselves with any rules related to the other party. This helps avoid confusion and offers a great amount of clarity to tax payment in Singapore.

Income Tax in Singapore

Income Tax is the tax you pay on your annual earnings to the government of the country you reside in or make your money in. The earnings include your salary or business income, rental income, and housing and stock options offered by your employer. You don’t have to pay any income tax on Singapore dividends, interest earned on bank deposits and income earned outside Singapore.

Income Tax in Singapore is decided on the basis of your residency status. The tax rates are progressive for residents and fixed for non-residents. The rates for residents range from 0% for the first S$20,000 that you earn, to 22% on any amount above S$320,000. The rates for non-residents is the higher of 15% or the resident rates applicable as per your income. While residents can enjoy tax relief and exemptions, non-residents get no such perks.

Corporate tax for companies is levied at a rate of flat 17% on chargeable income. This is applicable whether the company is local or foreign. Clubs and Associations are subject to the same tax structure as a company.

The income tax assessment year for Singapore is January 1 to December 31. IRAS will send you the Notice of Assessment by September every year. You need to file your tax returns before 15 April of the following year. For tax purposes, the basis period of the Year of Assessment (YA) – or the tax year – would be the previous year, or the relevant year of income. For example, if you are a salaried individual, your YA 2018 would consider the income received between 1 January 2017 to 31 December 2017. But if you are a businessperson who follows a fiscal year of April 1 to March 31, then your YA 2018 would be 1 April 2016 to 31 March 2017.

Tax can be paid in the following ways:

  • Internet Banking
  • Credit cards
  • GIRO transfers
  • AXS Stations
  • AXS e-station/m-station
  • SAM Kiosks
  • SAM Web or SAM mobile

Several tax rebates, tax reliefs and tax exemptions are available to all kinds of tax-paying entities except to non-residents.

Property Tax in Singapore

Property tax is the tax you pay for owning a property in Singapore. Property tax rates are calculated by multiplying the annual value of your property with the applicable property tax rates. The annual value of the property is determined by market conditions, especially the assessed monthly rent of your property based on the general value of property in your area.

For example, if the rent of your property is estimated at S$650 per month, then the annual value of that property would be S$7,800. Based on this annual value, if the tax rate is 15%, then your property tax amount would be S$1,170.

The property tax slabs depend on the following parameters:

  • Owner-occupied residential property: The tax rate on a property which is occupied by the owner themselves ranges from 0% for the initial annual value of S$8,000 to 16% for values above S$130,000.
  • Non-owner occupied residential property: If the owner of a property does not live in it, and is either rented out or lying vacant, the tax slabs are different. It starts from 10% for the initial annual value of S$30,000 and goes up to 20% for values above S$90,000. Several residential properties that function as serviced apartments, welfare homes, students’ hostels or hospitals are part of exclusions that have to pay a flat property tax rate of 10%.
  • Commercial and industrial property (non-residential): All commercial and other non-residential properties have to pay a property tax of 10%. This is a fixed rate and has no variations irrespective of whether it is owner-occupied or not.

Goods & Services Tax(GST) in Singapore

Goods and Services Tax (GST) is levied on all sales and purchases of goods and services in Singapore, irrespective of whether the item is made in Singapore or imported. The standard rate of GST is 7% currently. There are zero-rated products and services such as export of goods and international services; exempted goods and services such as sale or renting of a residential building that is unfurnished and life insurance services; as well as out-of-scope goods and services such as private transactions and sales made in Free Trade Zone.

You need to register for GST if your taxable income for the 1-year ending in any quarter is over S$1 million. Even if your business is not making such a turnover, you can voluntarily register for GST. The amount you charge as GST should be paid to IRAS as output tax. Input tax is the GST your business pays on purchases for production or regular operations. If you are eligible to claim input tax, you can do so and either get a refund from IRAS or pay only an amount that is the difference between your input and output taxes.

Withholding Tax in Singapore

Withholding tax is collected when a payer is making some kinds of payments to non-resident companies or individuals. These payments include: management fees, technical service fees, royalty, interest, commission, etc. The withholding tax rates for each category are different, and are listed in the table below:

Nature of Income

Tax Rate

Loan or debt payments such as fee, commission, interest and other payments

15%

Rent and other payments for using moveable properties

15%

For non-resident property traders, earnings from sale of real property

15%

Royalty and other lump sum payments for using moveable properties

10%

Distribution of taxable income made by REIT to non-resident unit-holders

10%

Payment for using scientific, technical, industrial or commercial knowledge or information

10%

Technical assistance and service fees

Existing Corporate Tax rate

Management fees

Existing Corporate Tax rate

Time and voyage charter fees for aircraft charters

0 to 2%

Time, voyage and bareboat charter fees for the charter of ships

Not applicable

Betting and Casino Taxes in Singapore

IRAS levies taxes on legal betting, sweepstakes, lotteries and casino operations. The rates for these are:

  • 25% of (the amount of bets minus winnings paid minus GST) for horse racing bets
  • 30% of (the amount of bets minus GST) for cash or credit betting, including pari-mutuel or totalisator betting not related to horse racing
  • 30% of (the amount added to sweepstakes minus GST) for Sweepstakes
  • 9.5% of the turnover for non-GST registered Fruit Machine clubs
  • 9.5% of (the turnover minus GST) for GST registered Fruit Machine clubs
  • 30% of sales for non-GST registered tambola, scheduled lottery or continuous lucky draw clubs
  • 30% of (sales minus GST) for GST-registered tambola, scheduled lottery or continuous lucky draw clubs
  • 5% for premium players who have deposit accounts of at least S$100,000 with the casino operator
  • 15% for other casino players

Other taxes in Singapore

IRAS also collects Stamp Duty, Estate Duty, and taxes from Charities and Trusts.

Stamp duty is collected on shares, property, and property-holding entities. Documents such as lease and tenancy agreements, property transfer papers, and mortgage are subject to stamp duty. The rate ranges from 1% to 3% as Buyer’s Stamp Duty, 15% as Additional Buyer’s Stamp Duty and 12% as Seller’s Stamp Duty.

Estate Duty is collected when someone has died and leaves monetary or asset inheritance for kith and kin. However, since 15 February 2008, Estate Duty has been discontinued. The inheritance bestowed on beneficiaries after the death of a person is taxed at the rate of 17% (as the legal personal representative) if the income is not distributed before 31 March in the year after the YA. If the income is distributed before this time, then the applicable tax rate is as per the beneficiary’s personal income.

IRAS Schemes

IRAS has several schemes to help boost local productivity, support businesses and persons with financial constraints, and improve the people’s overall lifestyle. Some of the top schemes of IRAS are:

For Individuals:

  1. Supplementary Retirement Scheme (SRS): This is a voluntary plan for individuals to save more for their retirement years in addition to CPF monies.
  2. Angel Investors Tax Deduction Scheme (AITD): This scheme hopes to boost investment in startups and is available for 10 years from 1 March 2010 to 31 March 2020.
  3. Not Ordinarily Resident (NOR) Scheme: This is a special scheme that gives tax discounts for five years for non-residents who spend a lot of time in Singapore.
  4. Area Representative Schemes: This scheme is for people who are employed by an overseas company to manage their Singapore operations.

For companies:

  1. Productivity and Innovation Credit (PIC): Companies can claim 400% tax deductions or a 60% cash payout for investments made in an eligible activity between YA 2013 and 2018.
  2. Wage Credit Scheme (WCS): Employers can claim 40% of the wage hikes given to Singapore citizens whose total monthly wages are S$4,000 or less between 2013 and 2015.
  3. Auto-Inclusion Scheme for Employment Income: This scheme allows companies to submit the employment income information of their employees to the IRAS through electronic channels.
  4. Business and IPC Partnership Scheme (BIPS): This scheme is offered up to 31 December 2018, and gives companies a tax deduction of 250% on the expenses incurred on sending employees to volunteer for Institutions of a Public Character (IPCs).
  5. Double Tax Deduction for Internationalisation Scheme: Up to 31 March 2020, under this scheme, businesses can claim double tax deduction for up to S$100,000 on expenses such as overseas business development trips, foreign investment study trips, participation in trade fairs abroad, etc.

GST schemes:

  1. Tourist Refund Scheme (for retailers): This scheme allows GST-registered businesses offer refunds on the GST paid by tourists on products and services bought from them. It is known as the electronic Tourist Refund Scheme (eTRS).
  2. Tourist Refund Scheme (for consumers): This is for visitors from other countries who buy items from retailers who are part of the eTRS.
  3. Cash Accounting Scheme: This plan aims to help small businesses alleviate their cash flow. Small businesses with less thanS$1 million as annual sales can calculate output tax when receiving payment from your customers and can claim input tax only for payments made to suppliers.
  4. Discounted Sale Price Scheme: Those who are part of this scheme can sell a pre-owned vehicle with GST charged on 50% of the selling price.
  5. Gross Margin Scheme: Used products sellers who buy GST-free goods can charge GST on resale under this plan.
  6. Approved Contract Manufacturer and Trader (ACMT) Scheme: Traders and contract manufacturers who are part of this scheme don’t need to provide details of the GST collected on value-added activities sold to non-GST registered customers outside Singapore.
  7. Approved Import GST Suspension Scheme (AISS): This allows aerospace companies that are registered for GST to claim extra import GST suspension benefits for eligible aircraft components.
  8. Approved Marine Customer Scheme (AMCS): This plan allows businesses registered with GST to get zero-rating on eligible purchases or renting of goods, and repair or maintenance services on ship components.
  9. Approved Marine Fuel Trader (MFT) Scheme: Traders under this scheme are exempt from paying GST when buying eligible marine fuel oil from local GST-registered sellers.
  10. Approved Refiner and Consolidator Scheme (ARCS): Refiners and consolidators that are part of this scheme get benefits such as extra input tax perks and GST suspension on eligible imports.
  11. Approved Third Party Logistics (3PL) Company Scheme: Logistics companies that are part of this scheme are exempt from paying import GST when they serve overseas clients. They also get certain exemptions from charging GST on supplying goods of their overseas clients.
  12. Hand-Carried Exports Scheme (HCES): Traders can charge zero GST for their products sold to foreign customers if the products are taken out of Singapore manually through the Changi International Airport.
  13. Import GST Deferment Scheme (IGDS): GST on imports payments, which is usually paid when the import is approved, can pay the amount at the same time as their monthly returns under this plan.
  14. Zero GST Warehouse Scheme: This scheme allows import GST on duty-free imported products to be suspended when the products are transferred to a Zero GST warehouse. You need to pay GST only when the imported products are taken out of the warehouse and put into the Singaporean market.
  15. Major Exporter Scheme (MES): This scheme allows GST on duty-free goods to be suspended at importation point and when the products are taken out of Zero GST warehouses.

IRAS eServices

IRAS offers e-services for all kinds of taxpayers, whether they are individuals, companies, GST payers or property taxpayers. You need to log in to the IRAS myTax portal using your SingPass id. The services accessible to different taxpayers are:

Individuals:

  • Use myTax Mail to communicate with IRAS.
  • Update contact details
  • File your income tax forms B or B1
  • View your filing status
  • View individual tax notices
  • View payment and account summary
  • View and manage late-filing or non-filing of Income Tax forms or documents
  • Check the status of employment income
  • Object to an assessment made by IRAS on your income tax
  • Apply for cash compensation under PIC scheme
  • Seek transfer of Parenthood Tax Rebate

Businesses:

  • There are separate e-services for companies, partnership firms, commission-paying organisations, employers, self-employed persons, sole proprietors and partners.

GST payers:

  • These services include myTax Mail, e-services Authorisation System (EASY), e-filing of GST returns, and view return status, payments and the register of GST businesses.

Property tax payers:

  • These include services for property owners and property professionals.
    • Those for property owners include applying for owner-occupier tax rates, check property tax balance and payments, and filing objection to annual value.
    • Those for property professionals include checking annual value of property, updating property ownership details and e-Stamping.

Others:

  • Services are also available for withholding tax, IPCs, and corporate engaged in government-to-business transactions.

Role of tax agents

Tax agents are professionals who help people file their taxes and manage their tax payments and liabilities. IRAS authorises tax agents as partners in administering the tax system and ensuring compliance. A tax agent is expected to discharge these duties:

  • Provide proper legal advice and high-quality service to their clients
  • Be open, transparent and honest in their dealings with both the customers and IRAS
  • Not assist anyone in deceiving the government, nor cheat an honest citizen

Tax agents can get certification from Singapore Institute of Accredited Tax Professionals (SIATP) and gain better skills for their profession.

IRAS Board, organisational structure and mission

The mission of IRAS is two-fold: “To act as an agent of the Government and provide service in the administration of taxes, and to advise the Government, and represent Singapore internationally, on matters relating to taxation.” Its vision is to be “the leading revenue authority in the world”, to be “a partner of the community in nation-building and inclusive growth” and to be a “dynamic team of competent and committed people”.

IRAS is supervised by the IRAS Board which currently consists of the following persons:

Other important personages in IRAS are:

Name

Designation

James Khor Ngiap Long

Deputy Commissioner – Individual Group

Eng-Tay Geok Lee

Deputy Commissioner – Business Group Chief Compliance Officer

Chia-Tern Huey Min

Deputy Commissioner – International, Investigation and Indirect Taxes Group

Wilson Ong

Deputy Commissioner – Corporate and Services Group

Andy Seah Yong Luck

Assistant Commissioner – Individual Income Tax Division

Poh Lai Khim

Assistant Commissioner – Taxpayer Services Division Quality Service Manager

Chiam Yah Fang

Assistant Commissioner – Corporate Tax Division

Tang Siau Yan

Assistant Commissioner – Tax Policy and International Tax Division

Quek Su Lynn

Assistant Commissioner – Compliance Strategy and Risk Division

Evelyn Lio

Assistant Commissioner – International Tax Affairs and Relations Division

Lawrence Eng

Assistant Commissioner – Investigation and Forensics Division

Sabina Cheong Hwee Bin

Assistant Commissioner – Goods and Services Tax Division

Wang Teck Leng

Assistant Commissioner – Property Tax Division

Ang Sock Tiang

Assistant Commissioner – Accounting and Processing Division

Patricia Mak

Assistant Commissioner – Enforcement Division

Evelyn Khoo Lay Sian

Assistant Commissioner – Corporate Development Division / Valuation Projects

Jackalin Er Hwee Pheng

Assistant Commissioner – Corporate Services Division

Alvin Koh Meng Sing

Chief Legal Officer – Law Division

Tang Wai Yee

Assistant Commissioner – Infocomm Division

There are two committees functioning under the Board –

  1. Audit and Risk Committee: This panel assesses the competence and compliance of IRAS’s fiscal policies, financial statements, accounting, and internal controls, among others.
  2. Staff Committee A: This panel approves the important salary and wage policies of IRAS and deals with appointments, promotions and salary hikes.

You can contact IRAS through the IRAS hotlines, email, or direct visit any time for your tax-related queries and functions.

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News About IRAS

  • Budget 2018 Focuses on Long-Term Capacity Building for Businesses

    Businesses are likely to get a boost with a number of incentives announced for them. Higher corporate tax exemptions and capability building programmes were the key takeaways from budget 2018.

    21st February 2018

  • IRAS Imposes GST on Imported Digital Services

    IRAS (Inland Revenue Authority of Singapore) said that the imported digital services will attract the Goods and Services Tax (GST). According to the e-tax guide by IRAS, the services include downloading of apps, e-books, and movies, subscription for online gaming and newspaper, and streaming of TV shows and music.

    The list also consists of downloading of software, website filter and firewalls, electronic data management like website hosting, cloud services along with online courses, and listing services for merchants.

    The Finance Minister of Singapore, Heng Swee Keat stated in his Budget 2018 speech that any overseas company that supplies these digital services will pay GST from January 2020.

    Under the new tax, overseas companies that have an annual global turnover of S$1 million or more and sells these digital services for S$100,000 to Singaporeans will have to register, charge, and account for GST.

    21st February 2018

  • Singapore Budget 2018 to Be Presented on 19 February

    The Ministry of Finance Singapore recently said that the Finance Minister would deliver the budget speech for the year on 19 February 2018. It has encouraged the public to share feedback through live Facebook Q&A session and REACH Listening Points.

    02nd January 2018


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