You have to be aware of the taxation regulations of Singapore, if you have a thriving business there. Sure, you are likely to get numerous agencies and companies willing to provide you with a local office and handle all the documentation as well as the filing during registration of your company yet there are few companies who are skilled enough to deal with Singapore Tax matters when it comes to an expat or foreign national company owners.
Fret not though! It might be difficult but not all is lost, if you check out the facts before. Here are the basics. Do take a look…
Remember that your company will have to pay the tax according to the revenue it earned the previous year. So, if you want to pay the tax in 2016, it will be calculated on your income in 2015.
It is not the profit only that will be checked though. You have to keep all documents pertaining to your company expenses too.
Your tax amount will be gauged for a basis year (financial year) that is a 12 month long period and the year ending dates for the year 2016 are ascertained as 31st January 2016, 30th June, 2016, and 31st Dec 2016.
Well, you need to submit the required taxation forms to the IRAS thereafter. There are two different Income tax forms that you will have to update before submission though. The forms include:-
ECI Form – This is an account of your ‘Estimated Chargeable Income’ that you have to submit within the stipulated period of 3 months from the basis year ending of your company. There are no exceptions made here usually unless you are eligible for an ‘Administration Concession’ or your company is exempt from submitting the ECI.
Corporate Income Tax Returns- This form is commonly known as the C-S or C form and needs to be submitted by the end of November each year. However, the IRAS regulations state that companies that have no activities at present will be exempt from paying Singapore tax.
The authorities responsible for overseeing income tax matters are often very strict and companies are required to give a true and complete statement of accounts pertaining to the income in the said financial year.
Companies are also required to keep the records of all financial transactions up to a period of 5 years starting from the current year of assessment.
The other documents required by the IRAS for taxation include:-
All transaction related documents including records
Documents related to accounting
Accounting Time line (schedules)