Singapore Tax System

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Singapore Tax System

There are several reasons for investors turn to Singapore for establishi­ng their operations and one of the determinan­t is Singapore’s tax regime – well-known for its attractive corporate and personal tax rates, tax relief measures, non-taxable capital gains, one tier tax system and extensive double tax treaties.

For Singapore tax purposes, taxable income refer to:

a. gains or profits from any trade or business; b. income from investment such as dividends, interest and rental; c. royalties, premiums and any other profits from property; and d. other gains that is revenue in nature.

Deductions such as business expenses, capital allowances and reliefs can be claimed to reduce taxable income, which leads to lower taxes.

For Singapore tax purposes, non-taxable income refer to:

i. Capital Gains

Capital gains are not taxable. Examples of these are: a. gains on sale of fixed assets; and b. gains on foreign exchange on capital transactio­ns.

ii. Income Exempted from Tax

Certain types of income are specifical­ly exempted from tax under the Income Tax Act, subject to conditions. Examples of these are: a. certain shipping income derived by a shipping company under Section 13A and Section 13F; b. foreign-sourced dividends, branch profits & service income received by a resident company under

Section 13(8); and c. company's gains on disposal of equity investment­s under Section 13Z

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