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SINGAPORE GOODS & SERVICES TAX (GST)

WHAT IS GST?
Goods and Services Tax (GST) is a consumption tax that is levied on the supply of goods and services
in Singapore and the import of goods into Singapore. GST is an indirect tax, expressed as a percentage
(currently 7%) applied to the selling price of goods and services provided by GST registered business
entities in Singapore.
It is also commonly known as Value Added Tax (VAT) in many other countries.

What goods and services are subjected to GST?
All goods and services are taxable and known as taxable supplies. However, some items are specifically
exempt from GST by law. Exempted items include financial services and the sale or lease of residential
properties.

When is it compulsory to Register?
Your business must be registered to collect GST if your annual turnover exceeds or is likely to exceed S$1
million from the sale of taxable goods and services. This requirement may be waived if most of your goods
or services are exported or supplied internationally (“zero-rated supplies”).

Can I choose to register?
You may also apply to the Comptroller of GST to collect GST voluntarily. Approval for voluntary registration
is at the discretion of the Comptroller. Once approval is given, you must remain registered for at least two
years.

Why should I register?
Most businesses register for GST to claim back the GST incurred on their business purchases.
When GST paid exceeds GST collected, the difference can be claimed from IRAS as a GST refund.
When GST rate increase, it may make business sense to voluntarily register to collect GST in order to claim
back GST incurred on business purchases.

Who can register?
• Sole proprietorships
• Partnerships
• Limited Liability partnerships
• Companies
• Clubs, associations, management
corporations or organizations

Last updated on February 18, 2013

• Non-profit organizations
• Statutory boards
• Government bodies

Copyright © 2013 Rikvin Pte Ltd

HOW DOES GST WORK?
GST is a broad-based consumption tax levied on the import of goods (collected by Singapore Customs), as
well as nearly all supplies of goods and services in Singapore.
The only exemptions are for the sales and leases of residential properties and the provision of most financial
services. Export of goods and international services are zero-rated. In some countries, GST is known as the
Value Added Tax (VAT).
Standard-Rated
Supplies (7%)
Goods

Most local sales
would fall under this
category.
(e.g. sale of TV set in a
Singapore retail shop)

Services

Most local provision
of services would
fall under this
category.E.g. provision
of spa services to
customer in Singapore

Zero-Rated
Supplies (0%)

Exempt Supplies

Out-Of-Scope
Supplies

Export of goods

Sale and rental of
Sale where goods
unfurnished residential are delivered from
property.
overseas to another
(e.g. sale of laptop to
place overseas. Private
overseas customer.
Note: If you supply
Transacation
The laptop is shipped
furnish property, the
to an overseas address rent on the furnish
by the supplier)
item should be
charged separate with
GST where applicable.
Services that
are classified as
international services
(e.g. air ticket from
Singapore to Thailand
- international
transportation service)

Financial services
(e.g. issue of a debt
security)

It is compulsory for businesses to come forward to register for GST when their turnover exceeds $1mil per
year. Businesses that do not exceed $1mil in turnover may register for GST voluntarily.
After registration, businesses must charge GST at the prevailing rate. This GST that they charge and collect
is known as output tax, which has to be paid to IRAS. GST incurred on business purchases and expenses
(including import of goods) are known as input tax. Businesses can claim input tax if conditions for claiming
are satisfied. This credit mechanism ensures that only the value added is taxed at each stage of a supply
chain.

Last updated on February 18, 2013

Copyright © 2013 Rikvin Pte Ltd

WHAT IS TAXABLE TURNOVER?
Taxable turnover is the total value of all taxable supplies made in Singapore (excluding GST) in the course
or furtherance of business. This includes the value of all standard-rated (GST at 7 %) and zero-rated (GST
at 0%) supplies but it excludes exempt supplies, out-of-scope supplies and the sale of capital assets.
For the purpose of determining your liability for GST registration, the value of exempt supplies that are
international services under Section 21(3) of the GST Act should also be excluded from your total taxable
supplies.

Tax turnover is
determined by

Including

1. Standard-rated supplies
(GST at 7%)
2. Zero-rated Supplies
(GST at 0%)

Excluding

1. Exempt supplies
(including those exempt
supplies that are also
international services
under Section 21(3) of
the GST Act)
2. Out-of-scope supplies
3. Sale of Capital Assets
(e.g. sale of machinery)

Last updated on February 18, 2013

Copyright © 2013 Rikvin Pte Ltd

LIABILITY TO REGISTER FOR GST
When am I liable to register for GST?
You are liable to register for GST when your annual taxable turnover exceeds S$1 million or you are currently
making taxable supplies and your annual taxable turnover is expected to exceed S$1 million.

How to determine my liability to register?
You can determine your liability to register for GST using the prospective or retrospective view. The table
below summarises your liability to register, notification of liability and effective date of registration under
each of the two views.
(A) Retrospective View

(B) Prospective View

Your liability will arise if:

At the end of any quarter*,
where the total value of all
your taxable supplies made in
Singapore in that quarter and
the previous 3 quarters have
exceeded S$1m. If you expect
that the value of your taxable
supplies in the next 4 quarters
will not exceed S$1m, you are
not required to be registered.
However, please note that
if the value of your taxable
supplies for the next 4 quarters
subsequently exceeds S$1
million, the Comptroller will
backdate your GST registration.

At any time, if there are
reasonable grounds for
believing that the total value
of your taxable supplies in the
next 12 months will exceed
S$1m (You must be currently
making taxable supplies to come
under this basis. Otherwise,
you should apply for voluntary
registration).

You are required to apply for
GST registration:

Within 30 days of the end of
that relevant quarter*.

Within 30 days from the date
on which you made a forecast
that your taxable turnover for
the next 12 months will exceed
S$1m.

Your date of registration will be:

End of the month following the
month in which the 30th day
falls.

End of 30 days from the date of
your forecast.

* Quarter means a period of 3 months ending on the last day of March, June, September or December.
Note: You should commence charging GST with effect from the date you are registered for GST. GST paid
on your business purchases and imports can be claimed from this date onwards.

Last updated on February 18, 2013

Copyright © 2013 Rikvin Pte Ltd

GST FAQS
I am an overseas trader with no establishment in Singapore but I am making taxable
supplies. Can I register for GST?
An overseas trader who contracts to sell goods in Singapore can register in his own name. The overseas
trader must appoint a local agent to be responsible for all GST matters, i.e. collecting GST on local taxable
supplies made or filing GST returns promptly, etc. For the overseas trader to appoint a local agent, a letter
of authorisation must be submitted together with the form GST F1 “Application for GST Registration”.

Are there any GST Schemes to help businesses?
To create a pro-enterprise environment, Singapore has several assistance schemes relating to GST. These
schemes generally help to ease the cash flow for businesses.
• Goods and Services Tax Assistance Scheme
Get a grant to lower the costs involved in becoming a GST-registered trader. GST traders can collect
GST and claim back for GST paid to suppliers.
• Major Exporter Scheme (MES)
Major exporters can improve their cash flow by deferring GST payments on goods imported mainly
for re-export out of Singapore.
• Licensed Warehouse Scheme
Transform your warehouse into a licensed warehouse for storing dutiable goods. In licensed
warehouses, duty and Goods and Services Tax (GST) are suspended until the goods are released for
sale into Singapore.
• Zero GST Warehouse Scheme (ZGS)
Businesses can transform their warehouses into zero-GST warehouses to minimise red tape and
bypass the GST process.

Online Resources
Singapore Goods & Services Tax | GST Registration | FAQ’s on GST

Last updated on February 18, 2013

Copyright © 2013 Rikvin Pte Ltd

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Accounting Services
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This material has been prepared by Rikvin for the exclusive
use of the party to whom Rikvin delivers this material.
This material is for informational purposes only and has
no regard to the specific investment objectives, financial
situation or particular needs of any specific recipient.
Where the source of information is obtained from third
parties, Rikvin is not responsible for, and does not accept
any liability over the content.

Copyright © 2013 Rikvin Pte Ltd


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