What is the Inland Revenue Authority of Singapore (IRAS)?

The Inland Revenue Authority of Singapore, also known as IRAS, is organized into different divisions: individuals concerned with personal tax, and companies concerned with corporate income tax.

What is the tax system in Singapore?

The Singapore tax system is based on a territorial concept. As a result, companies and individuals are mainly taxed on the income they receive in Singapore.

Unless the full amount has already been subject to tax in a jurisdiction that has general tax rates of at least 15%, foreign source income is taxed when it is repatriated or considered remitted to Singapore.

Finally, although this territorial concept seems simple, its implementation can sometimes be complicated. Therefore, there is no universal rule applicable to all situations. Whether profits are generated or derived from Singapore depends on the nature of the profits and the transactions that generate them.

What is the role of the Inland Revenue Authority of Singapore?

The Inland Revenue Authority of Singapore deals with all matters relating to direct and indirect taxes that an individual or company may have. Thus, the two main functions of the authority are collecting all forms of taxes and functioning as a tax advisor to the government.

Guide to Understanding the Inland Revenue Authority of Singapore

1. Collection of taxes

The Inland Revenue Authority of Singapore is in charge of collecting the following taxes:

➤ Income tax, which is levied on both individuals and companies
Goods and Services Tax, which is consumption-based and applies to all goods and services, including imports
Property tax, which is levied on landowners based on the projected rental values of their assets
➤ Stamp duty on real estate
➤ Land entities are subject to stamp duty
➤ Stamp duty on shareholders
Withholding taxes on trust estates
➤ Duties on betting and raffles in private lotteries
➤ Clubs and associations for casino tax
➤ Charities
➤ Dividends, capital gains and estates are all tax exempt

2. The tax advisor function

The IRAS is the main tax advisor in Singapore. It drafts tax policy, assists the Ministry of Finance in drafting tax legislation and processes treaties. Through this agency, Singapore has entered into about 100 double tax treaties with foreign countries, allowing people to avoid paying tax twice on their income.

How to connect to the IRAS to find out your tax status?

Whether you are an individual or a company, you can find out your tax status by logging into your personal IRAS account, known as myTaxPortal.

You will need your SingPass ID to access your personal account. For businesses, this is your CorpPass ID. To contact the organization, visit their official website.

It is possible to connect your accounting software to the Inland Revenue Authority of Singapore. However, the accounting software in this case must meet the technical requirements set up by the IRAS and must also be in the list of approved software.

The Inland Revenue Authority of Singapore, with its digital accessibility, has made it easier for individuals and businesses to contact the regulator. Indeed, you can visit the website of the Inland Revenue Authority of Singapore, log in to IRAS and contact the IRAS hotline.

What are the compliance requirements of the Inland Revenue Authority of Singapore?

An individual will receive a notification to file a tax return in the form of a letter, form or SMS. To file your IRAS tax return, you can choose to file electronically via the myTax portal or fill in the paper form.

If you choose to file your IRAS return online through the myTax portal, you must do so between March 1 and April 18 of each year. However, if you choose to file by paper form, you must do so by April 15 each year.

Enforcement proceedings will be initiated if you do not file your IRAS tax return on time or if you make errors in your return. As a result, staying compliant and submitting documents on time while running your business can be difficult.

You and your business can remain compliant with the IRAS by meeting the following requirements:

1. Estimated taxable income is the projection of a business’ taxable income for a given tax year. Within three months of the end of the financial year, each company must submit an estimate of its taxable income for the tax year.

2. Under the Singapore Financial Reporting Standard, all Singapore companies must create accounting records that include a profit and loss statement, a balance sheet, a cash flow statement and a statement of equity.

3. Income tax returns must also be submitted. The deadline for filing a corporate income tax return is November 30. Audited and unaudited reports and tax calculations must be submitted.

4. Each company is required to file a financial report.

5. If a company has a corporate shareholder, a turnover of more than S$5 million or more than 20 shareholders, it must submit an audited report.

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