Corporate tax compliance refers to the process of ensuring that a company complies with the tax laws and regulations of the country where it operates. In Singapore, companies are required to comply with the Income Tax Act and Goods and Services Tax Act. Corporate tax compliance is important for several reasons. Firstly, it helps companies avoid penalties and fines for non-compliance. Secondly, it helps companies maintain good relationships with the tax authorities. Finally, it helps companies avoid reputational damage that can result from non-compliance.
Corporate Income Tax
Corporate Income Tax (CIT) is a tax levied on the income of companies in Singapore. The tax is levied on the company’s chargeable income, which is the income that is subject to tax after deducting allowable expenses.
Basis Period & Year of Assessment
The basis period for CIT is the financial year (FY) preceding the Year of Assessment (YA). The YA is the year in which the company’s chargeable income is assessed to tax.
Corporate Income Tax Rate
The current CIT rate in Singapore is 17%. However, there are various tax incentives and schemes available to companies that can reduce their effective tax rate.
Corporate Income Tax Filing Obligations
Companies are required to file two CIT returns with the Inland Revenue Authority of Singapore (IRAS) every year. The first return is the Estimated Chargeable Income (ECI) return, which must be filed within three months from the end of the company’s financial year. The second return is the Form C-S/ Form C-S (Lite)/ Form C return, which must be filed by 30 November of each year.
Tax Deductibility of Expenses
Tax Deductibility of Expenses refers to the expenses that can be deducted from a company’s chargeable income when calculating the amount of tax payable.
Expenses Pre-commencement expenses refer to expenses incurred before the commencement of business operations. These expenses are deductible over a period of five years from the year in which the business operations commence.
Record Keeping Requirements
Companies are required to maintain proper records and accounts of their transactions and financial position. These records must be kept for at least five years from the end of the financial year to which they relate.
Obtaining a Copy of Documents Issued by IRAS
Companies can obtain copies of documents issued by the Inland Revenue Authority of Singapore (IRAS) through the myTax Portal.
Corporate Income Tax Rate, Rebates & Tax Exemption Schemes
Companies are eligible for CIT rebates that can reduce their tax liability. The amount of the rebate depends on the company’s tax residency status and the year of assessment. There are various tax exemption schemes available to companies in Singapore. These schemes are designed to encourage entrepreneurship and innovation in Singapore.
Updating Company Particulars
Companies are required to update their particulars with the Accounting and Corporate Regulatory Authority (ACRA) within 14 days of any changes to their particulars.
E-Learning Videos/ Webinars/ Seminars on Corporate Income Tax
The IRAS provides e-Learning videos, webinars, and seminars on Corporate Income Tax. These resources are designed to help companies understand their tax obligations and comply with the tax laws and regulations in Singapore.
Consider Hiring Tax Compliance & Consultation Services in Singapore
Corporate income tax compliance services in Singapore are available to help companies comply with the tax laws and regulations in Singapore. These services can help companies understand their tax obligations and provide guidance on how to comply with the tax laws and regulations in Singapore.
Corporate tax compliance is an important aspect of doing business in Singapore. Companies are required to comply with the tax laws and regulations in Singapore to avoid penalties and fines. This guide has provided an overview of the basics of corporate tax compliance in Singapore, including Corporate Income Tax, Tax Deductibility of Expenses, Record Keeping Requirements, obtaining a Copy of Documents Issued by IRAS, Corporate Income Tax Rate, Rebates & Tax Exemption Schemes, Updating Company Particulars and e-Learning Videos/ Webinars/ Seminars on Corporate Income Tax. By following these guidelines, companies can ensure that they comply with the tax laws and regulations in Singapore and maintain good relationships with the tax authorities.