PART 11 | Rates of tax upon individuals |
| 42.—(1) There is to be levied and paid for each year of assessment upon the chargeable income of every person (other than a body of persons, a company, a person not resident in Singapore, a trustee who is not the trustee of an incapacitated person, or an executor), tax in accordance with the rates specified in Part A of the Second Schedule in respect of the chargeable income of an individual. [27/2021] [S 40/2022] | (2) [Deleted by Act 27 of 2021] |
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| Rebate for children of family |
42A.—(1) Where an individual resident in Singapore has —| (a) | a second child of the family born to him or her on or after 1 January 2004 who is legitimate at the time of the birth; | | (b) | an illegitimate second child of the family born to him or her on or after 1 January 2004 and the individual becomes lawfully married to the other natural parent of the child before the child reaches 6 years of age; | | (c) | a second child of the family adopted by him or her under any written law relating to the adoption of children on or after 1 January 2004 and before 1 January 2006; or | | (d) | a second child of the family adopted by him or her under any written law relating to the adoption of children on or after 1 January 2006 and before the child reaches 6 years of age, |
| then there is, in respect of that child, to be allowed for the year of assessment immediately following the year of the birth in the case of paragraph (a), the year of the marriage in the case of paragraph (b), or the year of the adoption in the case of paragraph (c) or (d), a rebate of $10,000 against the tax payable by that individual. |
(2) Where an individual resident in Singapore has —| (a) | a third or fourth child of the family born to him or her on or after 1 January 2004 who is legitimate at the time of the birth; | | (b) | an illegitimate third or fourth child of the family born to him or her on or after 1 January 2004 and the individual becomes lawfully married to the other natural parent of the child before the child reaches 6 years of age; | | (c) | a third or fourth child of the family adopted by him or her under any written law relating to the adoption of children on or after 1 January 2004 and before 1 January 2006; or | | (d) | a third or fourth child of the family adopted by him or her under any written law relating to the adoption of children on or after 1 January 2006 and before the child reaches 6 years of age, |
| then there is, in respect of that child, to be allowed for the year of assessment immediately following the year of the birth in the case of paragraph (a), the year of the marriage in the case of paragraph (b), or the year of the adoption in the case of paragraph (c) or (d), a rebate of $20,000 against the tax payable by that individual. |
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(2A) Where an individual resident in Singapore has —| (a) | a first child of the family born to him or her on or after 1 January 2008 who is legitimate at the time of the birth; | | (b) | an illegitimate first child of the family born to him or her on or after 1 January 2008 and the individual becomes lawfully married to the other natural parent of the child before the child reaches 6 years of age; or | | (c) | a first child of the family adopted by him or her under any written law relating to the adoption of children on or after 1 January 2008 and before the child reaches 6 years of age, |
| then there is, in respect of that child, to be allowed for the year of assessment immediately following the year of the birth in the case of paragraph (a), the year of marriage in the case of paragraph (b), or the year of the adoption in the case of paragraph (c), a rebate of $5,000 against the tax payable by that individual. |
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(2B) Where an individual resident in Singapore has —| (a) | a fifth or subsequent child of the family born to him or her on or after 1 January 2008 who is legitimate at the time of the birth; | | (b) | an illegitimate fifth or subsequent child of the family born to him or her on or after 1 January 2008 and the individual becomes lawfully married to the other natural parent of the child before the child reaches 6 years of age; or | | (c) | a fifth or subsequent child of the family adopted by him or her under any written law relating to the adoption of children on or after 1 January 2008 and before the child reaches 6 years of age, |
| then there is, in respect of that child, to be allowed for the year of assessment immediately following the year of the birth in the case of paragraph (a), the year of marriage in the case of paragraph (b), or the year of the adoption in the case of paragraph (c), a rebate of $20,000 against the tax payable by that individual. |
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| (2C) Where more than one individual is entitled to claim the rebate mentioned in subsection (1), (2), (2A) or (2B), the rebate is to be apportioned between them in such proportion as they may agree or, in the absence of any agreement, in such manner as appears to the Comptroller to be reasonable. |
| (3) For the purposes of subsections (1) to (2C), where full effect cannot be given to the rebate in respect of any child by reason of an insufficiency of the tax payable by an individual for that year of assessment, the balance of the unabsorbed rebate is available for deduction against the tax payable by the individual for the year of assessment immediately following that year of assessment and any subsequent year of assessment. |
| (4) Where the child in respect of whom a rebate is allowable to an individual under this section is adopted by another person, the rebate or balance (if any) of the unabsorbed rebate is not available for deduction against the tax payable by the individual for any year of assessment following the year in which the child is adopted. |
| (5) Where, for the year of assessment 2005 or any subsequent year of assessment, an individual would have been entitled to claim any rebate or balance of the unabsorbed rebate under section 42A(1) and (2)(a) in force immediately before 1 January 2005 but for the repeal of that section, such rebate or balance is, subject to subsection (4), available for deduction against the tax payable by that individual for the year of assessment 2005 and any subsequent year of assessment; but where more than one individual is entitled to claim such rebate, the rebate is to be apportioned between them in such proportion as they may agree or, in the absence of any agreement, in such manner as appears to the Comptroller to be reasonable. |
(6) Where, for the year of assessment 2005 or any subsequent year of assessment, a married woman would have been entitled to claim any rebate or balance of the unabsorbed rebate under section 42A(2)(b) and (3) in force immediately before 1 January 2005 but for the repeal of that section —| (a) | such rebate or balance is, subject to subsection (4), available for deduction against the tax payable by that woman for the year of assessment 2005 and any subsequent year of assessment up to 9 years of assessment immediately following the year of birth of the third child or fourth child, as the case may be; and | | (b) | where the fourth child is born within 9 years of the birth of the third child and full effect cannot be given to the rebate in respect of the fourth child by reason of an insufficiency of the tax payable by that woman for that year of assessment, the rebate or balance (if any) of the unabsorbed rebate is, subject to subsection (4), available for deduction, in the case of the fourth child, against the tax payable by that woman for up to 9 years of assessment immediately following the last year of assessment in which the rebate in respect of the third child may be allowed under paragraph (a). |
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(7) Where, for the year of assessment 2005 or any subsequent year of assessment, a married woman would have been entitled to claim any rebate or balance of the unabsorbed rebate under section 42A(1), (2) and (3) in force immediately before 1 January 2005 but for the repeal of that section, the rebate or balance of the unabsorbed rebate in respect of the third child or fourth child (as the case may be) under section 42A(2)(b) and (3) in force immediately before 1 January 2005 must —| (a) | subject to subsection (4), first be allowed for deduction against the tax payable by that woman before the rebate or balance of the unabsorbed rebate under section 42A(1) and (2)(a) in force immediately before 1 January 2005 is allowed; and | | (b) | subject to section 42A(4)(b) and (c) in force immediately before 1 January 2005, be available for deduction for the year of assessment 2005 and any subsequent year of assessment. |
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(8) Where a marriage has been dissolved by divorce or annulment and an individual is entitled to claim —| (a) | any rebate or balance of the unabsorbed rebate under section 42A(1) or (2) in force immediately before 1 January 2005, but for the repeal of that section, in respect of any child born to the individual from that marriage; and | | (b) | any rebate under section 42A(1) or (2) in force immediately before 1 January 2005, but for the repeal of that section, in respect of any child born to the individual after the dissolution of the marriage, |
| subsections (5), (6) and (7) only apply to any second, third or fourth child (as the case may be) born to the individual after the dissolution of the marriage. |
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| (9) Where a marriage was dissolved by divorce or annulment before 1 January 2002 and an individual would, but for section 42A(3)(e) in force immediately before that date, have been entitled to claim any rebate or balance of the unabsorbed rebate under section 42A(1) or (2) in force immediately before 1 January 2005, such rebate or balance is, subject to section 42A(4)(a) to (d) in force immediately before 1 January 2005, available for deduction against the tax payable by that individual only on due claim by that individual after that date and only for any year of assessment from the year of the claim. |
| (10) No rebate is allowed under this section for the year of assessment 2008 or a preceding year of assessment, in respect of a child who at the time of his or her birth or adoption or the marriage of his or her natural parents (as the case may be), has more than 3 other siblings who are members of the same household. |
| (10A) No rebate is allowed under this section in respect of a child who is adopted by an individual before the individual is married. |
(11) In this section —“first child of the family” means a child of the family who —| (a) | is a citizen of Singapore at the time of his or her birth or adoption or the marriage of his or her natural parents (as the case may be), or within 12 months thereafter; and | | (b) | at the time of his or her birth, adoption or the marriage of his or her natural parents (as the case may be), has no other sibling who is a member of the same household; |
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“second child of the family” means a child of the family who —| (a) | is a citizen of Singapore at the time of his or her birth or adoption or the marriage of his or her natural parents (as the case may be), or within 12 months thereafter; and | | (b) | at the time of his or her birth, adoption or the marriage of his or her natural parents (as the case may be), has one other sibling who is a member of the same household; |
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“third child of the family” means a child of the family who —| (a) | is a citizen of Singapore at the time of his or her birth or adoption or the marriage of his or her natural parents (as the case may be), or within 12 months thereafter; and | | (b) | at the time of his or her birth, adoption or the marriage of his or her natural parents (as the case may be), has 2 other siblings who are members of the same household; |
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“fourth child of the family” means a child of the family who —| (a) | is a citizen of Singapore at the time of his or her birth or adoption or the marriage of his or her natural parents (as the case may be), or within 12 months thereafter; and | | (b) | at the time of his or her birth, adoption or the marriage of his or her natural parents (as the case may be), has 3 other siblings who are members of the same household; |
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“fifth or subsequent child of the family” means a child of the family who —| (a) | is a citizen of Singapore at the time of his or her birth or adoption or the marriage of his or her natural parents (as the case may be), or within 12 months thereafter; and | | (b) | at the time of his or her birth, adoption or the marriage of his or her natural parents (as the case may be), has at least 4 other siblings who are members of the same household; |
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| “sibling” means a brother or sister and includes a stepbrother, a stepsister and a brother or sister adopted under any written law relating to the adoption of children. |
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| (12) For the purposes of subsection (11), any sibling who is deceased must be taken into account in determining the number of siblings a child has at the time of his or her birth or adoption or the marriage of his or her natural parents unless otherwise determined by the Comptroller. |
| (12A) For the purposes of the definitions of “first child of the family”, “second child of the family”, “third child of the family”, “fourth child of the family” and “fifth or subsequent child of the family” in subsection (11), for the year of assessment 2022 or any subsequent year of assessment, any sibling of the child, being a sibling that is a stillborn child (whether issued from the child’s mother before, on or after 1 January 2022), is to be included in determining the number of siblings that the child has who are members of the same household, but only if the natural mother of the stillborn child is a member of that household. [27/2021] |
| (12B) To avoid doubt, subsection (12A) does not imply that a stillborn child is a child in respect of whom a rebate may be allowed under this section. [27/2021] |
(12C) In subsection (12A), “stillborn child” means —| (a) | a child that —| (i) | has issued from the child’s mother after the twenty-eighth week of pregnancy and before 29 May 2022; and | | (ii) | did not show any sign of life at any time after being completely expelled from the mother; |
| | (b) | a child that —| (i) | has issued from the child’s mother after the twenty-second week of pregnancy and on or after 29 May 2022 but before the date of commencement of section 2(c) of the Stillbirths and Births (Miscellaneous Amendments) Act 2024; and | | (ii) | did not show any sign of life at any time after being completely expelled or extracted from the mother; or |
| | (c) | a stillborn child as defined in section 2(1) of the Registration of Births and Deaths Act 2021 that issues from the child’s mother on or after the date of commencement of section 2(c) of the Stillbirths and Births (Miscellaneous Amendments) Act 2024. [Act 2 of 2024 wef 16/04/2024] |
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(13) For the purposes of subsection (11), a child is a member of a household if —| (a) | the members of the household include both the parents of the child or, if there is only one surviving parent, that parent; | | (b) | in the case where the parents of the child are divorced, any member of the household is a parent of the child who has sole legal custody of the child; or | | (c) | in the case where the parents of the child are divorced and neither has sole legal custody of the child, any member of the household is a parent of the child who has been given rights of care and control in respect of the child by any court. |
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| (14) If the child is a member of more than one household by virtue of subsection (13)(c), the child is treated as such member of the household of only one parent as determined by the Comptroller (whose decision is final) having regard to the circumstances of the case, including the child’s living arrangements. |
| (15) In subsection (13), “parent” includes an adoptive parent and a step‑parent. |
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| Rate of tax upon companies and others |
43.—(1) There is to be levied and paid for each year of assessment upon the chargeable income of —| (a) | every company or body of persons, tax at the rate of 17% on every dollar of the chargeable income thereof; | | (b) | every individual not resident in Singapore —| (i) | for the year of assessment 2023 or a preceding year of assessment, tax at the rate of 22% on every dollar of the chargeable income thereof; and | | (ii) | for the year of assessment 2024 and subsequent years of assessment, tax at the rate of 24% on every dollar of the chargeable income thereof; and [Act 33 of 2022 wef 04/11/2022] |
| | (c) | every other person not resident in Singapore, trustee (other than the trustee of an incapacitated person) and executor, tax at the rate of 17% on every dollar of the chargeable income thereof. [2/2016; 41/2020] |
| (2) Where any trustee proves to the Comptroller’s satisfaction that any beneficiary of the trust is entitled to a share of the trust income, a corresponding share of the statutory income of the trustee may be charged at a lower rate or not charged with any tax, as the Comptroller determines. |
| (2AA) Subsection (2) does not apply to a trust that is a REIT exchange‑traded fund unless it is an approved REIT exchange‑traded fund. [45/2018] |
(2A) Subsection (2) does not apply to —| (a) | in the case of a real estate investment trust, any income from any trade or business carried on by the trustee, other than the following income distributed by the trustee in cash or, if the conditions specified in subsection (2B) are satisfied, in units in the trust:| (i) | rental income or income from the management or holding of immovable property but not including gains from the disposal of immovable property; | | (ii) | income that is ancillary to the management or holding of immovable property but not including gains from the disposal of immovable property; | | (iii) | income that is payable out of rental income or income from the management or holding of immovable property in Singapore, but not out of gains from the disposal of such immovable property; | | (iv) | distribution from an approved sub‑trust of the real estate investment trust out of income mentioned in paragraph (b)(i), (ii) and (iii); | | (v) | rental support payment in relation to any immovable property, which is paid to the trustee by —| (A) | the person (A) who sold to the trustee the property or any interest in the owner of the property; | | (B) | a person who wholly owns (directly or indirectly) A; or | | (C) | any other person approved by the Comptroller; |
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| | (b) | in the case of any approved sub‑trust of a real estate investment trust, any income from any trade or business carried on by the trustee, other than the following income distributed by the trustee in cash to the trustee of the real estate investment trust:| (i) | rental income or income from the management or holding of immovable property but not including gains from the disposal of immovable property; | | (ii) | income that is ancillary to the management or holding of immovable property but not including gains from the disposal of immovable property; | | (iii) | rental support payment in relation to any immovable property, which is paid to the firstmentioned trustee by —| (A) | the person (A) who sold to that trustee the property or any interest in the owner of the property; | | (B) | a person who wholly owns (directly or indirectly) A; or | | (C) | any other person approved by the Comptroller; |
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| | (ba) | in the case of an approved REIT exchange‑traded fund, any income from any trade or business carried on by its trustee, other than a distribution in cash received in the period between 1 July 2018 and 31 December 2025 (both dates inclusive) from a real estate investment trust, that is in turn made out of any income mentioned in paragraph (a)(i) to (v); or | | (c) | in the case of any other trust, any income from any trade or business carried on by the trustee. [34/2016; 45/2018; 32/2019] |
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(2B) The conditions referred to in subsection (2A)(a) are —| (a) | the distribution is made at any time on or after 1 April 2012 by the trustee of the real estate investment trust out of income specified in subsection (2A)(a)(i) to (v); | | (b) | before the distribution, the trustee of the real estate investment trust has given to unitholders receiving the distribution an option to receive the same either in cash or units in the trust; and | | (c) | the trustee of the real estate investment trust has sufficient cash available on the date of such distribution to make the distribution fully in cash had no option been given to those unitholders to receive the distribution in units in the trust. [34/2016; 32/2019] |
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| (2C) To avoid doubt, subsection (2) (read with subsection (2A)(ba)) does not affect the operation of section 35(12) in relation to an approved REIT exchange‑traded fund that is also a designated unit trust within the meaning of section 35(14). [45/2018] |
(3) Despite anything in this Act but subject to subsection (3A), tax at the rate of 15% is to be levied and paid on the gross amount of —| (a) | any income referred to in section 12(6); and | | (b) | any income referred to in section 12(7)(a), (b) and (d) but excluding the incomes specified in subsection (7), |
| accruing in or derived from Singapore on or after 28 February 1996 by a person not resident in Singapore which is not derived by the person from any trade, business, profession or vocation carried on or exercised by the person in Singapore and which is not effectively connected with any permanent establishment in Singapore of the person. |
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| (3A) Despite anything in this Act, tax at the rate of 10% is to be levied and paid on the gross amount of any income referred to in section 12(7)(a) and (b) but excluding the incomes specified in subsection (7), accruing in or derived from Singapore on or after 1 January 2005 by a person not resident in Singapore which is not derived by the person from any trade, business, profession or vocation carried on or exercised by the person in Singapore and which is not effectively connected with any permanent establishment in Singapore of the person. |
(3B) Despite anything in this Act, tax at the rate of 10% is to be levied and paid on the gross amount of any distribution made out of any income mentioned in subsection (2A)(a)(i), (ii), (iii), (iv) and (v) during the period from 18 February 2005 to 31 December 2025 (both dates inclusive) by a trustee of any real estate investment trust to a person (other than an individual) not resident in Singapore —| (a) | who does not have any permanent establishment in Singapore; or | | (b) | who carries on any operation in Singapore through a permanent establishment in Singapore, where the funds used by that person to acquire the units in that real estate investment trust are not obtained from that operation. [37/2014; 2/2016; 34/2016; 32/2019] |
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(3C) Despite anything in this Act, tax at the rate of 10% is levied and must be paid on the gross amount of any distribution by a trustee of an approved REIT exchange‑traded fund that is —| (a) | made out of a distribution by a real estate investment trust that is in turn made out of income of the kinds mentioned in subsection (2A)(a)(i), (ii), (iii), (iv) and (v); | | (b) | made during the period from 1 July 2018 to 31 December 2025 (both dates inclusive); and | | (c) | made to a person (other than an individual) not resident in Singapore —| (i) | that does not have any permanent establishment in Singapore; or | | (ii) | that carries on any operation in Singapore through a permanent establishment in Singapore, where the funds used by that person to acquire the units in that approved REIT exchange‑traded fund are not obtained from that operation. [45/2018; 32/2019] |
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| (3D) In the application of subsection (3B) to a distribution mentioned in that subsection made during the period from 1 July 2019 to 31 December 2025 (both dates inclusive) to a person mentioned in subsection (3F) with a fund manager in Singapore, that fund manager is not considered a permanent establishment in Singapore of that person. [32/2019] |
| (3E) In the application of subsection (3C) to a distribution mentioned in that subsection made during the period from 1 July 2019 to 31 December 2025 (both dates inclusive) to a person mentioned in subsection (3F) with a fund manager in Singapore, that fund manager is not considered a permanent establishment in Singapore of that person. [32/2019] |
(3F) Subsection (3D) or (3E) applies to a distribution made to any of the following persons or entities that is not resident in Singapore:| (a) | a prescribed person (other than an individual) under section 13D; | | (b) | an approved person under section 13U; | | (c) | a person (not being an individual, a body of persons or a Hindu joint family) that is the approved master fund or an approved feeder fund of an approved master‑feeder fund structure under section 13U; | | (d) | a partner of a partnership (including a limited partnership and a limited liability partnership), where the partnership is the approved master fund or an approved feeder fund of an approved master‑feeder fund structure under section 13U; | | (e) | a trustee of a trust fund where the trust fund is the approved master fund or an approved feeder fund of an approved master‑feeder fund structure under section 13U; | | (f) | a taxable entity in relation to the approved master fund or an approved feeder fund of an approved master‑feeder fund structure under section 13U, where the master fund or feeder fund is not a legal entity; | | (g) | a company, a trustee of a trust fund or a partner of a limited partnership, where the company, trust fund or limited partnership is an approved feeder fund of an approved master‑feeder fund‑SPV structure under section 13U; | | (h) | a person (not being a company, an individual or a Hindu joint family) that is an approved feeder fund of an approved master‑feeder fund‑SPV structure under section 13U; | | (i) | a partner of a partnership (excluding a limited partnership but including a limited liability partnership), where the partnership is an approved feeder fund of an approved master‑feeder fund‑SPV structure under section 13U; | | (j) | a taxable entity in relation to an approved feeder fund of an approved master‑feeder fund‑SPV structure under section 13U, where the feeder fund is not a legal entity; | | (k) | an approved 1st tier SPV of an approved master‑feeder fund‑SPV structure under section 13U; | | (l) | an approved 2nd tier SPV of an approved master‑feeder fund‑SPV structure under section 13U; | | (m) | an approved eligible SPV of an approved master‑feeder fund‑SPV structure under section 13U, where the eligible SPV is not one mentioned in paragraphs (n), (o) and (p); | | (n) | a partner of an approved eligible SPV of an approved master‑feeder fund‑SPV structure under section 13U, where the eligible SPV is a partnership (including a limited partnership and a limited liability partnership); | | (o) | the trustee of an approved eligible SPV of an approved master‑feeder fund‑SPV structure under section 13U, where the eligible SPV is a trust fund; | | (p) | the taxable entity of an approved eligible SPV of an approved master‑feeder fund‑SPV structure under section 13U, where the eligible SPV is not a legal entity; | | (q) | an approved 1st tier SPV of an approved master fund‑SPV structure under section 13U; | | (r) | an approved 2nd tier SPV of an approved master fund‑SPV structure under section 13U; | | (s) | an approved eligible SPV of an approved master fund‑SPV structure under section 13U, where the eligible SPV is not one mentioned in paragraphs (t), (u) and (v); | | (t) | a partner of an approved eligible SPV of an approved master fund‑SPV structure under section 13U, where the eligible SPV is a partnership (including a limited partnership and a limited liability partnership); | | (u) | the trustee of an approved eligible SPV of an approved master fund‑SPV structure under section 13U, where the eligible SPV is a trust fund; | | (v) | the taxable entity of an approved eligible SPV of an approved master fund‑SPV structure under section 13U, where the eligible SPV is not a legal entity; | | (w) | a prescribed sovereign fund entity or an approved foreign government‑owned entity under section 13V. [32/2019] |
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(4) Despite anything in this Act but subject to subsections (4A) and (5) and sections 13(1)(r), (ra) and (rb) and 40A, tax at the rate of 15% is to be levied and paid on the gross amount of any income accruing in or derived from Singapore on or after 3 May 2002 from any profession or vocation carried on by —| (a) | an individual not resident in Singapore and whose principal place of business is situated outside Singapore; or | | (b) | a foreign firm. [2/2016] [Act 33 of 2022 wef 04/11/2022] |
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(4A) Despite anything in this Act but subject to subsection (5), tax at the rate of 10% is to be levied and paid on the gross amount of any income derived from Singapore during the period from 1 April 2023 to 31 December 2027 (both dates inclusive) —| (a) | by an individual not resident in Singapore, from acting as an arbitrator; | | (b) | by a qualifying mediator who is not resident in Singapore, for providing the services of a mediator for a mediation —| (i) | that takes place in Singapore; or | | (ii) | that would have taken place in Singapore but for the settlement of the dispute or withdrawal of the claim in question; or |
| | (c) | by an individual not resident in Singapore, for providing the services of a mediator for a qualifying mediation —| (i) | that takes place in Singapore; or | | (ii) | that would have taken place in Singapore but for the settlement of the dispute or withdrawal of the claim in question. [Act 33 of 2022 wef 04/11/2022] |
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| (5) Any individual or foreign firm to which subsection (4) or (4A) applies may make an irrevocable option to be taxed under subsection (1)(b) by the 15th day of the second month following the month in which the payment of the income is liable to be made to the individual or firm. [Act 33 of 2022 wef 04/11/2022] |
| (6) Despite subsection (1) but subject to subsection (6C), tax as described in subsection (6A) or (6B) (as the case may be) is levied and must be paid for each year of assessment upon the chargeable income of every company or body of persons. [45/2018] |
(6A) For the purposes of subsection (6), the tax that is levied —| (a) | in the case of a company, for the years of assessment 2008 to 2019 (both years inclusive); and | | (b) | in the case of a body of persons, for the years of assessment 2010 to 2019 (both years inclusive), |
| is tax at the rate prescribed in subsection (1)(a) on every dollar of the chargeable income, except that — |
| (c) | for every dollar of the first $10,000 of the chargeable income, only 25% is chargeable with tax; and | | (d) | for every dollar of the next $290,000 of the chargeable income, only 50% is chargeable with tax. [45/2018] |
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(6B) For the purposes of subsection (6), the tax that is levied for the year of assessment 2020 and subsequent years of assessment, is tax at the rate prescribed in subsection (1)(a) on every dollar of the chargeable income, except that —| (a) | for every dollar of the first $10,000 of the chargeable income, only 25% is chargeable with tax; and | | (b) | for every dollar of the next $190,000 of the chargeable income, only 50% is chargeable with tax. [45/2018] |
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| (6C) Despite subsections (1) and (6), where, in any of the first 3 years of assessment falling in or after the year of assessment 2008 of a company, the company is a qualifying company, then for that year of assessment tax as described in subsection (6D) is levied and must be paid upon the chargeable income of the company. [45/2018] |
(6D) For the purposes of subsection (6C), the tax that is levied is tax at the rate prescribed in subsection (1)(a) on every dollar of the chargeable income, except that —| (a) | for the years of assessment 2008 to 2019 (both years inclusive) —| (i) | every dollar of the first $100,000 of the chargeable income is exempt from tax; and | | (ii) | for every dollar of the next $200,000 of the chargeable income, only 50% is chargeable with tax; and |
| | (b) | for the year of assessment 2020 and subsequent years of assessment —| (i) | for every dollar of the first $100,000 of the chargeable income, only 25% is chargeable with tax; and | | (ii) | for every dollar of the next $100,000 of the chargeable income, only 50% is chargeable with tax. [45/2018] |
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(7) The incomes excluded under subsections (3)(b) and (3A) are —| (a) | any royalty and other payments referred to in section 10(14) or (16) which are derived by the person not resident in Singapore; and | | (b) | any payment to a person not resident in Singapore for the rendering of assistance or service in connection with the application or use of scientific, technical, industrial or commercial knowledge or information. |
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(8) The reference to 17% in subsection (1) is —| (a) | for the years of assessment 2005, 2006 and 2007, a reference to 20%; and | | (b) | for the years of assessment 2008 and 2009, a reference to 18%. |
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| (9) Despite subsection (1)(a), the tax to be levied and paid upon such income of a life insurer (other than a captive insurer) apportioned to the policyholders of the insurer as the Minister may by regulations specify is at the rate of 10% or such other prescribed rate. |
(10) In this section —| “approved REIT exchange‑traded fund” means a REIT exchange‑traded fund that is approved by the Comptroller for the purposes of subsection (2); |
“approved sub‑trust”, in relation to a real estate investment trust, means any trust —| (a) | not listed on the Singapore Exchange or elsewhere; | | (b) | where the trustee of the real estate investment trust holds any right or interest in the property of the trust for the benefit of the beneficiaries of the real estate investment trust; and | | (c) | approved by the Comptroller; |
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| “arbitrator” means an individual appointed for any arbitration which is governed by the Arbitration Act 2001 or the International Arbitration Act 1994, or would have been governed by either of those Acts had the place of arbitration been Singapore; [Act 33 of 2022 wef 04/11/2022] |
| “captive insurer” has the meaning given by section 2 of the Insurance Act 1966; |
| “first 3 years of assessment”, in relation to a qualifying company, means the year of assessment relating to the basis period during which the company is incorporated in Singapore and the 2 consecutive years of assessment immediately following that year of assessment; |
| “foreign firm” means an unincorporated body of 2 or more persons who have entered into partnership with one another with a view to carrying on business for profit and whose principal place of business is situated outside Singapore; |
| “gross amount”, in relation to any income referred to in subsections (3), (3A), (3B) and (4), means the full amount of the income without any deduction and relief being allowed against the income under the provisions of this Act; |
| “immovable property‑related assets” means listed or unlisted debt securities and listed shares issued by property corporations, mortgage‑backed securities, other property funds, and assets incidental to the ownership of immovable property; |
“qualifying company”, in relation to a year of assessment, means a company incorporated in Singapore which for that year of assessment —| (a) | is resident in Singapore; and | | (b) | where the company —| (i) | is not a company limited by guarantee, has its total share capital beneficially held directly by no more than 20 shareholders —| (A) | all of whom are individuals throughout the basis period for that year of assessment; or | | (B) | at least one of whom is an individual holding at least 10% of the total number of issued ordinary shares of the company throughout the basis period for that year of assessment; or |
| | (ii) | is a company limited by guarantee, has members —| (A) | all of whom are individuals throughout the basis period for that year of assessment; or | | (B) | at least one of whom is an individual throughout the basis period for that year of assessment, and the contribution of that individual under the memorandum of association of the company to the assets of the company in the event of its being wound up, amounts to at least 10% of the total contributions of the members of the company throughout the basis period for that year of assessment; |
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| “qualifying mediation” means a mediation that is administered by a body or an organisation that provides services for the conduct of mediation (called in this section a mediation service provider), and that is prescribed under section 7; [Act 33 of 2022 wef 04/11/2022] |
| “qualifying mediator” means an individual who is certified or accredited under a mediator certification or accreditation scheme prescribed under section 7; [Act 33 of 2022 wef 04/11/2022] |
| “real estate investment trust” means a trust that is constituted as a collective investment scheme authorised under section 286 of the Securities and Futures Act 2001 and listed on the Singapore Exchange, and that invests or proposes to invest in immovable property and immovable property‑related assets; |
“REIT exchange‑traded fund” means a collective investment scheme authorised under section 286 of the Securities and Futures Act 2001 and listed on the Singapore Exchange, and that invests or proposes to invest only in —| (a) | real estate investment trusts; and | | (b) | any entity, trust or other arrangement that invests or proposes to invest in immovable property and immovable property‑related assets, and is listed on a stock exchange outside Singapore; |
|
“rental support payment”, in relation to immovable property, means any payment —| (a) | made under an agreement —| (i) | made at the time of the sale mentioned in subsection (2A)(a)(v)(A) or (b)(iii)(A); and | | (ii) | that provides for such payment to be made only for a fixed period of time; and |
| | (b) | that is intended to compensate a party to the agreement in the event that the amount of rental income from the property over a period of time is less than an amount agreed as the expected rental income for the same period, taking into account prevailing and forecasted market conditions at the time of that sale. [34/2016; 45/2018] |
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(11) Despite the definition of “qualifying company” in subsection (10), a company that is incorporated on or after 26 February 2013 is not a qualifying company in relation to any year of assessment if —| (a) | it undertakes property development in the basis period for that year of assessment, whether or not that is the only activity it carries out during the basis period; | | (b) | it is a partner of a partnership which undertakes property development in the basis period for that year of assessment, whether or not that is the only activity the partnership carries out during the basis period; | | (c) | its only activity in that basis period is the holding of investments; or | | (d) | it is a partner of a partnership where the only activity of the partnership during that basis period is the holding of investments, and the company has no activity during that basis period or its only activity during that basis period is the holding of investments. |
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(12) For the purposes of subsection (11), a company or partnership undertakes property development if it carries out any of the following activities whether in Singapore or outside Singapore:| (a) | acquires land or building for the purpose of undertaking development (whether by the company or partnership or an entity to which it transfers the land or building) with a view to the sale or lease (whether by the entity undertaking the development or another entity to which the entity undertaking the development transfers the building or part thereof) of the whole or any part of the building so developed; | | (b) | development with a view to the sale or lease (whether by the company or partnership or another entity to which the company or partnership transfers the building or part thereof) of the whole or any part of the building so developed; | | (c) | the sale or lease of the whole or any part of a building developed by the company or partnership; | | (d) | any other activity that is preparatory to, connected with or incidental to any activity referred to in paragraph (a), (b) or (c). |
|
(13) In subsection (12) —| “acquire” includes acquire by way of purchase, grant, exchange, gift, settlement or otherwise; |
| “develop” means to construct or cause to construct a building, including any building operations in, on, over or under the land for the purpose of erecting the building; and “development” is to be construed accordingly. |
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| (14) For the purposes of the definitions of “qualifying mediation” and “qualifying mediator” in subsection (10), the Minister may prescribe a description of mediation service providers and a description of mediator certification or accreditation schemes that are set out on a specified website of the Ministry of Law, as amended from time to time. [Act 33 of 2022 wef 04/11/2022] |
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| Concessionary rate of tax for Asian Currency Unit, Fund Manager and securities company |
43A.—(1) Despite section 43, the Minister may by regulations provide that tax at the rate of 10% is to be levied and paid for each year of assessment upon such income derived before 1 January 2004 as the Minister may specify of —| (a) | a financial institution with an Asian Currency Unit; | | (b) | a Fund Manager; | | (c) | a company holding a capital markets services licence under the Securities and Futures Act 2001 to deal in securities or that is exempted under that Act from holding such a licence, |
| approved by the Minister or such person as the Minister may appoint. |
[34/2016] (2) Regulations made under subsection (1) may provide for —| (a) | exemption from tax of any income mentioned in that subsection; | | (b) | exemption from tax of such income as the Minister may specify of —| (i) | a bank or merchant bank licensed under the Banking Act 1970; and | | (ii) | a company approved under subsection (1)(c), |
| derived by it from any approved syndicated offshore credit or guarantee facility or any other syndicated offshore credit or guarantee facility made before 1 January 2004 which satisfies the prescribed criteria; |
| | (c) | deduction of losses, capital allowances and donations otherwise than in accordance with this Act; | | (d) | circumstances in which any losses (including impairment loss recognised under FRS 39, as defined in section 34A, and expected credit loss recognised under FRS 109 or SFRS(I) 9, as defined in section 34AA) incurred in respect of any facility mentioned in paragraph (b), and capital allowances and donations attributable to income from such facility which has been allowed as a deduction against any income chargeable to tax, may be deemed as income chargeable to tax (at such rate as may be prescribed) for a specified basis period; | | (e) | adjustment of any amount deemed as income chargeable to tax mentioned in paragraph (d) for the specified basis period; | | (f) | circumstances in which any income from any facility mentioned in paragraph (b) to be exempt from tax, may be adjusted for any basis period in which the income from such facility is derived; | | (g) | circumstances in which any impairment loss, bad debt or provision for doubtful debt in respect of any facility mentioned in paragraph (b), which has previously been allowed as a deduction against any income chargeable to tax and which is subsequently reversed, recovered or written back, may be deemed as income chargeable to tax (at such rate as may be prescribed) for any basis period in which the reversal is recognised or the recovery or write‑back occurs; and | | (h) | generally for giving full effect to or for carrying out the purposes of this section. [39/2017; 32/2019; 1/2020] |
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| Special rate of tax for non‑resident shipowner or charterer or air transport undertaking |
| 43B. Despite section 43, where the tax authority of a foreign country taxes the profits derived by a person resident in Singapore from carrying on the business of a shipowner or charterer or of air transport at a rate which exceeds the rate prescribed by section 43, the Minister may direct that the profits derived in Singapore from the carrying on of such business by a non‑resident person who is resident in that foreign country be charged to tax at a rate similar to that charged by the tax authority of that foreign country. |
| Exemption and concessionary rate of tax for insurance and reinsurance business |
43C.—(1) Despite section 43, the Minister may make regulations —| (a) | to provide for tax at the rate of 10% to be levied and paid for each year of assessment upon such income as the Minister may specify that is derived before 1 July 2021 by an approved insurer, whose approval is granted before 1 June 2017, from offshore life business within the meaning of section 26, or the business (other than the business of life assurance) of insuring and reinsuring offshore risks; | | (aa) | to provide for tax at the rate of 10% to be levied and paid for each year of assessment upon such income as the Minister may specify that is derived by an approved insurer, whose approval is granted on or after 1 June 2017, from the reinsurance of liabilities under policies relating to life business as defined in section 3(1)(a) of the Insurance Act 1966, or such description of general business within the meaning of section 3(1)(b) of that Act, as may be prescribed; | | (ab) | to provide for tax at the rate of 10% to be levied and paid for each year of assessment upon such income as the Minister may specify that is derived on or after 1 July 2021 by an approved insurer whose approval is granted before 1 June 2017, from —| (i) | the reinsurance of liabilities under policies relating to life business as defined in section 3(1)(a) of the Insurance Act 1966; or | | (ii) | such description of general business as defined in section 3(1)(b) of that Act, as may be prescribed; |
| | (b) | to provide for exemption from tax of such income as the Minister may specify that is derived from insurance and reinsurance business by the following:| (i) | an approved specialised insurer whose approval is granted before 1 September 2016; | | (ii) | an approved captive insurer whose approval is granted before 1 April 2018; |
| | (c) | to provide for tax at the rate specified in the first column of the following table, to be levied and paid for each year of assessment upon such income as the Minister may specify that is derived from insurance and reinsurance business by an approved insurer set out opposite that rate in the second column of the table: | | | | An approved specialised insurer whose approval is granted between 1 September 2016 and 31 August 2019 (both dates inclusive), and who had not been approved as such at any time before the date of the approval |
| | | An approved specialised insurer whose approval is granted between 1 September 2019 and 31 August 2021 (both dates inclusive), and who had not been approved as such at any time before the date of the approval |
| | | (i) | An approved specialised insurer whose approval is granted between 1 September 2016 and 31 August 2021 (both dates inclusive), and who had been approved as such at any time before the date of the firstmentioned approval |
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| (ii) | An approved captive insurer whose approval is granted on or after 1 April 2018 |
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| | (d) | to provide for exemption from tax of such income as the Minister may specify that is derived by an approved insurer whose approval is granted before 1 April 2016, from marine hull and liability insurance and reinsurance business; | | (e) | to provide for tax at the rate specified in the first column of the following table, to be levied and paid for each year of assessment upon such income as the Minister may specify that is derived from marine hull and liability insurance and reinsurance business by an approved insurer set out opposite that rate in the second column of the table: | | | | An approved insurer whose approval was granted between 19 February 2011 and 31 March 2016 (both dates inclusive), and who had been approved as such at any time before the date of the firstmentioned approval |
| | | An approved insurer whose approval is granted between 1 April 2016 and 31 March 2020 (both dates inclusive) |
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| | (f) | to provide for the deduction (otherwise than in accordance with this Act), from the income mentioned in paragraphs (a) to (e), of allowances under section 19, 19A, 20, 21, 22 or 23, expenses, losses and donations allowable under this Act, including deduction of these allowances, expenses, losses and donations in such manner and to such extent as the Comptroller may determine; | | (g) | to provide for the period of each approval, and the conditions subject to which a specified insurer may be or may continue to be approved; and | | (h) | to provide for such matters as the Minister may consider necessary or expedient for carrying out the purposes under paragraphs (a) to (g). [34/2016; 39/2017; 32/2019; 41/2020; 27/2021] |
| (2) No approval may be granted to an insurer for the purpose of paragraph (a), (aa), (b), (c), (d) or (e) of subsection (1) on or after the date prescribed in the regulations for that paragraph. [34/2016; 39/2017] |
(3) In this section —| “approved” means approved by the Minister or an authorised body; [Act 41 of 2020 wef 06/12/2022] |
| “captive insurer” has the meaning given by section 2 of the Insurance Act 1966; |
“insurer” means —| (a) | a company licensed under the Insurance Act 1966 to carry on insurance business in Singapore; or | | (b) | a person (including a partnership), other than an individual, permitted under the Insurance Act 1966 to carry on insurance business in Singapore under a foreign insurer scheme; |
|
| “marine hull and liability insurance and reinsurance business” means the business of insuring and reinsuring risks involving marine hull and liability but excludes cargo, energy and aviation risks; |
“specialised insurer” means an insurer underwriting any of the following insurance risks (whether or not it also underwrites any other type of risk):| (a) | terrorism risks; | | (b) | political risks; | | (c) | energy risks; | | (d) | aviation and aerospace risks; | | (e) | agriculture risks; | | (f) | risks arising from a natural catastrophe. [34/2016; 39/2017] |
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| Concessionary rate of tax for headquarters company |
43D.—(1) Despite section 43, the Minister may by regulations provide that tax at the rate of 10% is to be levied and paid for each year of assessment upon such income as the Minister may specify of an approved headquarters company derived by it from —| (a) | the provision of such qualifying services as may be prescribed to its offices, associated companies and other persons where such offices, associated companies and persons are outside Singapore; or | | (b) | such qualifying treasury, investment or financial activities as may be prescribed, |
| and those regulations may provide for the deduction of losses otherwise than in accordance with section 37(3). |
[34/2016] | (1A) This section does not apply to any income derived on or after 1 October 2015. [2/2016] |
(2) The concessionary rate of tax referred to in subsection (1) applies to an approved headquarters company —| (a) | in respect of any qualifying service only where the qualifying service and the office, associated company or person to whom the service is rendered have been approved in relation to that headquarters company for such concessionary rate; | | (b) | in respect of any qualifying treasury, investment or financial activity only where the qualifying activity has been approved in relation to that headquarters company for such concessionary rate; and | | (c) | subject to such conditions as the Minister or such person as the Minister may appoint may impose. |
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(3) Regulations made under subsection (1) may provide for exemption from tax of income derived by an approved headquarters company from the provision of any qualifying service if —| (a) | the qualifying service and the office, associated company or person to whom the service is rendered have been approved in relation to the approved headquarters company for the purposes of the exemption from tax; and | | (b) | the approved headquarters company has global responsibility for the provision of any qualifying service. |
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(4) In this section —| “approved” means approved by the Minister or such person as the Minister appoints; |
“associated company”, in relation to an approved headquarters company, means a company —| (a) | the operations of which are or can be controlled, directly or indirectly, by that headquarters company; | | (b) | which controls or can control, directly or indirectly, the operations of that headquarters company; or | | (c) | the operations of which are or can be controlled, directly or indirectly, by a person or persons who control or can control, directly or indirectly, the operations of that headquarters company; |
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| “headquarters company” means a company carrying on the business in Singapore of providing management, technical or other supporting services to its offices outside Singapore or to its associated companies outside Singapore. [34/2016] |
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(5) For the purposes of subsection (4), a company is deemed to be an associated company in relation to an approved headquarters company if —| (a) | at least 25% of the total number of its issued shares are beneficially owned, directly or indirectly, by the approved headquarters company; or | | (b) | at least 25% of the total number of the issued shares of the approved headquarters company are beneficially owned, directly or indirectly, by the firstmentioned company. [43E |
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| Concessionary rate of tax for Finance and Treasury Centre |
43E.—(1) Despite section 43, the Minister may by regulations provide that tax at the concessionary rate specified in subsection (1A) is levied and must be paid for each year of assessment upon such income as the Minister may specify of a company derived from —| (a) | the operation of its approved Finance and Treasury Centre in respect of such qualifying activities carried out on its own account as may be prescribed; or | | (b) | such prescribed qualifying services as may be provided by its approved Finance and Treasury Centre to —| (i) | its offices and associated companies outside Singapore; or | | (ii) | such of its offices and associated companies in Singapore as are approved on or after 18 February 2005, |
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| and those regulations may provide for the deduction of losses otherwise than in accordance with section 37(3). |
[34/2016] (1A) In subsection (1), the concessionary rate is —| (a) | in the case of a Finance and Treasury Centre approved as such on or before 24 March 2016, 10%; [Act 35 of 2024 wef 01/01/2024] | | (b) | in the case of a Finance and Treasury Centre approved as such after 24 March 2016 and on or before 16 February 2024, 8%; [Act 35 of 2024 wef 01/01/2024] | | (c) | in the case of a Finance and Treasury Centre approved as such on or after 17 February 2024, 8% or 10%, as specified by the Minister or an authorised body to the company; or [Act 35 of 2024 wef 01/01/2024] | | (d) | in a case to which subsection (1B) applies, the substituted concessionary rate mentioned in that subsection but only for income derived from (and including) the date specified by the Minister or authorised body to the company for the application of that rate, which may be a date earlier than the notice mentioned in that subsection but not earlier than 1 January 2024. [34/2016] [Act 35 of 2024 wef 01/01/2024] |
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| (1B) The Minister or an authorised body may, on or after 17 February 2024, on the Minister’s or authorised body’s own initiative or on the application of the company, by notice to the company substitute the concessionary rate of tax applicable to its approved Finance and Treasury Centre under subsection (1A)(b) or (c) with 8% or 10%, as the case may be. [Act 35 of 2024 wef 01/01/2024] |
(2) The concessionary rate of tax mentioned in subsection (1) applies to an approved Finance and Treasury Centre —| (a) | in respect of any qualifying service only where the qualifying service and the office or associated company to whom the service is rendered have been approved in relation to that Centre for such concessionary rate; and | | (b) | in respect of any qualifying activity only where the qualifying activity has been approved in relation to that Centre for such concessionary rate. [32/2019] |
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| (2A) The Minister or an authorised body may, subject to such conditions as the Minister or authorised body may impose, approve a Finance and Treasury Centre for a company for the purposes of this section. [32/2019] [Act 41 of 2020 wef 12/04/2024] |
(3) In this section —| “approved” means approved by the Minister or an authorised body; [Act 41 of 2020 wef 12/04/2024] |
“associated company”, in relation to a company with an approved Finance and Treasury Centre, means a company —| (a) | the operations of which are or can be controlled, directly or indirectly, by the company with the approved Centre; | | (b) | which controls or can control, directly or indirectly, the operations of the company with the approved Centre; or | | (c) | the operations of which are or can be controlled, directly or indirectly, by a person or persons who control or can control, directly or indirectly, the operations of the company with the approved Centre; |
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| “Finance and Treasury Centre” means a division or department of a company which provides treasury, investment or financial services in Singapore for its offices or its associated companies. [34/2016] |
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(4) For the purposes of subsection (3), a company is deemed to be an associated company in relation to a company with an approved Finance and Treasury Centre if —| (a) | at least 25% of the total number of its issued shares are beneficially owned, directly or indirectly, by the company with the approved Centre; or | | (b) | at least 25% of the total number of issued shares of the company with the approved Centre are beneficially owned, directly or indirectly, by the firstmentioned company. |
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| (5) No Finance and Treasury Centre may be approved as an approved Finance and Treasury Centre under this section after 31 December 2026. [43G [34/2016; 41/2020] |
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| Concessionary rate of tax for offshore leasing of machinery and plant |
| 43F.—(1) Despite section 43, tax at the rate of 10% is to be levied and paid for each year of assessment upon the income of a leasing company accruing in or derived from Singapore in respect of offshore leasing of any machinery or plant or such other activity as may be prescribed by regulations. [34/2016] | (1A) This section does not apply to any income accruing in or derived from Singapore on or after 1 January 2016. [2/2016] |
(2) In determining the income of a leasing company from offshore leasing —| (a) | the allowances under section 19, 19A, 20, 21, 22 or 23 must be taken into account even if no claim for such allowances has been made; | | (b) | the allowances under section 19, 19A, 20, 21, 22 or 23 in respect of offshore finance leasing in any year of assessment after deduction against the income from such leasing are available as a deduction against any income from onshore finance leasing for that year of assessment, and any balance of the allowances is not, subject to paragraph (c), available as a deduction against any other income or available for transfer under section 37B; | | (c) | where the leasing company ceases to derive income from finance leasing in the basis period for any year of assessment, any balance of the allowances in respect of finance leasing after the deduction in paragraph (b) is available as a deduction against any other income for that year of assessment and for any subsequent year of assessment in accordance with section 23; and | | (d) | the Comptroller must determine the manner and extent to which —| (i) | allowances under section 19, 19A, 20, 21, 22 or 23 and any expenses and donations allowable under this Act are to be deducted; and | | (ii) | any loss may be deducted under section 37. |
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| (3) Subsection (2) applies, with the necessary modifications, in determining the income of a leasing company from any activity prescribed by regulations made under subsection (1) as if such income were income from offshore operating leasing. |
| (4) [Deleted by Act 53 of 2007] |
| (5) [Deleted by Act 53 of 2007] |
| (6) Despite subsection (1), a leasing company may, at any time, elect that the whole of its income accruing in or derived from Singapore in respect of offshore leasing of any machinery or plant be taxed at the rate prescribed by section 43(1)(a). |
| (7) An election under subsection (6) must be made by a leasing company by written notice to the Comptroller and is irrevocable. |
(8) Where a leasing company has made an election under subsection (6) —| (a) | subsections (1), (2) and (3) do not apply to the income of the leasing company for the year of assessment immediately following the year in which the election is made and for subsequent years of assessment; and | | (b) | any allowance or the balance thereof in respect of finance leasing which was not deducted against the income of the leasing company for any year of assessment during which the concessionary rate prescribed by subsection (1) applies is available as a deduction against the income from finance leasing for the first year of assessment to which paragraph (a) applies and for any subsequent year of assessment. |
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(9) In this section —| “finance lease”, “finance leasing” and “onshore finance leasing” have the meanings given by section 10C(3); |
| “leasing company” means any company carrying on a business of leasing machinery or plant; |
| “offshore finance leasing” means the offshore leasing of any machinery or plant under any finance lease; |
“offshore leasing” means the leasing of any machinery or plant, other than those which have been treated as though they had been sold pursuant to regulations made under section 10C(1), where such machinery or plant is used outside Singapore, and the payments under the lease —| (a) | are in currencies other than Singapore dollars; and | | (b) | are not deductible against any income accruing in or derived from Singapore; |
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| “offshore operating leasing” means the offshore leasing of any machinery or plant, other than offshore finance leasing. [43I |
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| Concessionary rate of tax for trustee company |
| 43G.—(1) Despite section 43, the Minister may by regulations provide that tax at the rate of 10% is to be levied and paid for each year of assessment upon such income as the Minister may specify of an approved trustee company derived by it from such services as may be prescribed; and those regulations may provide for exemption from tax of any such income and for the deduction of losses otherwise than in accordance with section 37(3). [34/2016] | (2) In this section, “trustee company” means a company that is a licensed trust company within the meaning of the Trust Companies Act 2005, or that is exempted under that Act from holding a trust business licence within the meaning of that Act. |
| (3) The Minister or such person as the Minister may appoint may approve a trustee company as an approved trustee company for the purposes of this section. |
| (4) Any approval under subsection (3) must be for a period not exceeding 10 years as the Minister or the person appointed by the Minister may specify, and is subject to such conditions as the Minister may impose. |
| (5) No trustee company may be approved under subsection (3) on or after 1 April 2016. |
| (6) A trustee company that is an approved trustee company immediately before 1 April 2011 remains as an approved trustee company until 31 March 2021, unless its approval is revoked earlier. |
| (7) The trustee company mentioned in subsection (6) remains as an approved trustee company subject to such conditions as the Minister may impose. [43J |
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| Concessionary rate of tax for income derived from debt securities |
43H.—(1) Despite section 43, the Minister may by regulations provide that tax at the rate of 10% is to be levied and paid for each year of assessment upon —| (a) | interest derived by any company from any qualifying debt securities; | | (aa) | discount derived by any company from any qualifying debt securities issued during the period from 17 February 2006 to 31 December 2028 (both dates inclusive); [Act 30 of 2023 wef 30/10/2023] | | (ab) | any amount payable to any company from any Islamic debt securities which are qualifying debt securities, and issued during the period from 1 January 2005 to 31 December 2028 (both dates inclusive); [Act 30 of 2023 wef 30/10/2023] | | (ac) | any early redemption fee or redemption premium derived by any company from qualifying debt securities issued during the period from 15 February 2007 to 31 December 2028 (both dates inclusive); and [Act 30 of 2023 wef 15/02/2023] [Act 30 of 2023 wef 30/10/2023] | | (ad) | such other income derived by any company that is directly attributable to qualifying debt securities issued on or after a prescribed date, as may be prescribed by regulations. [37/2014; 34/2016; 45/2018; 41/2020] |
(2) Subsection (1)(a), (aa), (ab), (ac) or (ad) (as the case may be) does not, unless otherwise approved by the Minister or an authorised body, apply to —| (a) | any interest derived from any qualifying debt securities issued during the period from 10 May 1999 to 31 December 2028 (both dates inclusive); [Act 30 of 2023 wef 30/10/2023] | | (b) | any discount from any qualifying debt securities issued during the period from 17 February 2006 to 31 December 2028 (both dates inclusive); [Act 30 of 2023 wef 30/10/2023] | | (c) | any amount payable from any Islamic debt securities which are qualifying debt securities, and issued during the period from 1 January 2005 to 31 December 2028; [Act 30 of 2023 wef 30/10/2023] | | (d) | any early redemption fee or redemption premium from qualifying debt securities issued during the period from 15 February 2007 to 31 December 2028 (both dates inclusive); and [Act 30 of 2023 wef 15/02/2023] [Act 30 of 2023 wef 30/10/2023] | | (e) | such other income directly attributable to qualifying debt securities issued on or after a prescribed date, as may be prescribed by regulations, |
| where 50% or more of those securities which are outstanding at any time during the life of the issue is beneficially held or funded, directly or indirectly, by related parties of the issuer of those securities and where such income is derived by — |
| (f) | any company which is a related party of the issuer of those securities; or | | (g) | any company where the funds used by such company to acquire those securities are obtained, directly or indirectly, from any related party of the issuer of those securities. [37/2014; 45/2018; 41/2020] [Act 41 of 2020 wef 06/12/2022] |
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| (2A) Subsection (1) does not apply to income from qualifying debt securities derived by a financial sector incentive (standard tier) company. |
| (2B) Subsection (1) does not apply to income derived by a financial sector incentive (capital market) company from qualifying debt securities on or after 1 January 2014. [45/2018] |
| (3) Regulations made under subsection (1) may provide for exemption from tax of income derived by a primary dealer from trading in any Singapore Government securities during the period from 27 February 1999 to 31 December 2028 (both dates inclusive), and for deduction of losses otherwise than in accordance with section 37(3). [37/2014; 45/2018; 41/2020] [Act 30 of 2023 wef 30/10/2023] |
| (3A) A primary dealer mentioned in subsection (3) may elect in accordance with subsection (3B) not to be subject to the regulations made under subsection (1); and if the primary dealer so elects, the regulations cease to apply to the income of that primary dealer for the year of assessment for which the election is made and for subsequent years of assessment. [37/2014] |
(3B) The election mentioned in subsection (3A) must be made by the primary dealer by written notice to the Comptroller —| (a) | at the time of lodgment of the return of income for a year of assessment; or | | (b) | at such further time as the Comptroller may allow. [37/2014] |
|
| (3C) The election made by a primary dealer under subsection (3A) is irrevocable. [37/2014] |
(4) In this section —| [Deleted by Act 30 of 2023 wef 15/02/2023] |
| “debt securities” means bonds, notes, commercial papers, treasury bills, certificates of deposits, and AT1 instruments within the meaning of section 10I(2); |
| “early redemption fee”, “financial institution”, “qualifying debt securities” and “redemption premium” have the meanings given by section 13(16); [Act 30 of 2023 wef 15/02/2023] |
| “financial sector incentive (capital market) company” means a company approved as such under section 43J; |
| “financial sector incentive (standard tier) company” means a company approved as such under section 43J; |
“Islamic debt securities” means debt securities and trust certificates —| (a) | which are endorsed by any Shari’ah council or body, or by any committee formed for the purpose of providing guidance on compliance with Shari’ah law; and | | (b) | the amounts payable from such securities and trust certificates are periodic and supported by a regular stream of receipts from underlying assets; |
|
| “primary dealer” means any financial institution appointed by the Monetary Authority of Singapore as a primary dealer under section 29A of the Government Securities Act 1992; |
| “Singapore Government securities” means debt securities issued under the Government Securities Act 1992, the repealed Local Treasury Bills Act 1923, the Significant Infrastructure Government Loan Act 2021 or by the Government under any other written law, and is deemed to include any issue of bills and notes by the Monetary Authority of Singapore that are approved by the Minister for the purposes of this Act; [Act 35 of 2021 wef 31/01/2022] |
| “trust certificates” means certificates evidencing beneficial ownership in underlying assets. [37/2014; 45/2018; 32/2019; 15/2021] |
|
| (5) Subsections (1)(a), (aa), (ab), (ac) and (ad) and (2) and regulations made under any of those provisions apply to a body of persons for the year of assessment 2010 and subsequent years of assessment. [43N |
|
| Concessionary rate of tax for global trading company and qualifying company |
43I.—(1) Despite section 43, the Minister may by regulations provide that tax at the rate of 5%, 10% or 15% is to be levied and paid for each year of assessment upon —| (a) | such income as the Minister may specify of an approved global trading company —| (i) | that is derived by it from such prescribed qualifying transactions in such prescribed commodities as the Minister or an authorised body may specify to the company; [Act 41 of 2020 wef 12/04/2024] | | (ii) | that is derived by it in the basis period for the year of assessment 2012 or a subsequent year of assessment, from prescribed qualifying transactions in any derivative instrument; or | | (iii) | that is derived by it on or after 19 February 2020 from the carrying on of such prescribed qualifying structured commodity financing activities, prescribed treasury activities or prescribed advisory services in relation to mergers and acquisitions, as the Minister or an authorised body may specify to the company; and [Act 41 of 2020 wef 12/04/2024] |
| | (b) | such income as the Minister may specify of an approved qualifying company that is derived on or after 21 May 2010 from the carrying on of such prescribed qualifying structured commodity financing activities, prescribed treasury activities or prescribed advisory services in relation to mergers and acquisitions, as the Minister or an authorised body may specify to the company, |
| and those regulations may provide for the deduction of losses otherwise than in accordance with section 37(3). |
[34/2016; 41/2020] [Act 35 of 2024 wef 01/01/2024] [Act 41 of 2020 wef 12/04/2024] (1AA) Subject to the regulations under subsection (1), the income of an approved global trading company or approved qualifying company mentioned in that subsection —| (a) | is chargeable with tax at the rate of 5% if the company has been approved for that rate; [Act 35 of 2024 wef 01/01/2024] | | (b) | is chargeable with tax at the rate of 10% if the company has been approved for that rate; [Act 35 of 2024 wef 01/01/2024] | | (c) | is chargeable with tax at the rate of 15% if the company (being a global trading company approved on or after 17 February 2024) has been approved for that rate; or [Act 35 of 2024 wef 01/01/2024] | | (d) | in the case of an approved global trading company to which subsection (1AC) applies, is chargeable with tax at the substituted rate mentioned in that subsection but only for income derived from (and including) the date specified by the Minister or an authorised body to the company for the application of that rate, which may be a date earlier than the notice mentioned in that subsection but not earlier than 1 January 2024. [32/2019] [Act 35 of 2024 wef 01/01/2024] |
|
(1AB) For the purposes of this section, the Minister or an authorised body may, subject to such conditions as the Minister or authorised body may impose, approve —| (a) | a global trading company as an approved global trading company; or | | (b) | a qualifying company as an approved qualifying company. [32/2019] [Act 41 of 2020 wef 12/04/2024] |
|
| (1AC) The Minister or an authorised body may, on or after 17 February 2024, on the Minister’s or authorised body’s own initiative or on the application of the approved global trading company, by notice to the company substitute the rate of tax applicable to the company under subsection (1AA)(a), (b) or (c) with 5%, 10% or 15%, as the case may be. [Act 35 of 2024 wef 01/01/2024] |
| (1A) No approval may be granted under this section to a global trading company after 31 December 2026. [41/2020] |
| (1B) No approval may be granted under this section to a qualifying company after 31 March 2021, and any approval granted to a qualifying company must be for a period that commences on or before that date. [41/2020] |
| (2) [Deleted by Act 32 of 2019] |
(3) In this section —| “global trading company” means a company that carries on the business of international trading of commodities or commodities derivatives, or of brokering international trades in commodities, or both; |
“qualifying company” means —| (a) | an approved company that carries on the business of international trading of commodities or commodities derivatives; or | | (b) | a wholly‑owned subsidiary of another company, where the other company carries on the business of international trading of commodities or commodities derivatives, |
| that carries on any qualifying structured commodity financing activities, treasury activities, or advisory services in relation to mergers and acquisitions, prescribed under subsection (1). |
[43P [34/2016; 39/2017; 32/2019] |
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| Concessionary rate of tax for financial sector incentive company |
| 43J.—(1) Despite section 43, the Minister may by regulations provide that tax at the rate of 5%, 10%, 12% or 13.5% is to be levied and paid for each year of assessment upon such income as the Minister may specify, derived on or after 1 January 2004 by a financial sector incentive company from such qualifying activities as may be prescribed, and those regulations may provide for the deduction of losses otherwise than in accordance with section 37(3). [39/2017] | (2) The Minister or an authorised body may, subject to such conditions as the Minister or authorised body may impose, approve a company carrying on such qualifying activities as may be prescribed, as a financial sector incentive company for the purposes of this section, and the Minister or authorised body may approve different classes of financial sector incentive companies for the purposes of this section. [32/2019] [Act 41 of 2020 wef 06/12/2022] |
(2A) Regulations under subsection (1) may make transitional provisions to apply the rate of tax of 12% to —| (a) | any company which holds membership of any class or description of a futures market, or of a clearing house for the futures market, maintained by the Singapore Exchange Limited or any of its subsidiaries; and | | (b) | a member of the corporation known as the Singapore Commodity Exchange Ltd, |
| which has given notice within a specified period to the Monetary Authority of Singapore for the purposes of the application of these transitional provisions, in respect of its income derived on or after 1 January 2011 but on or before 31 December 2013 from specified qualifying activities. |
[43Q [34/2016] |
|
| Concessionary rate of tax for provision of processing services to financial institutions |
43K.—(1) Despite section 43, the Minister may by regulations provide that tax at the rate of 5% is to be levied and paid for each year of assessment upon such income as the Minister may specify of an approved company derived by it on or after 27 February 2004 from the provision of prescribed processing services in Singapore to any financial institution or another approved company; and those regulations may provide for the deduction of losses of an approved company otherwise than in accordance with section 37(3).| (2) The Minister or a person appointed by the Minister may, subject to such conditions as the Minister or appointed person may impose, approve a company as an approved company for the purposes of this section. [32/2019] |
| (3) No approval under this section may be granted to any company on or after 27 February 2009. |
(4) In this section, “financial institution” means —| (a) | any institution in Singapore that is licensed or approved by the Monetary Authority of Singapore, or exempted from such licensing or approval, under any written law administered by the Monetary Authority of Singapore; or | | (b) | any institution outside Singapore that is licensed or approved, or exempted from such licensing or approval, by its financial supervisory authority for the carrying on of financial activities. [43R |
|
|
| Concessionary rate of tax for shipping investment manager |
43L.—(1) Despite section 43, the Minister may by regulations provide that tax at the rate of 10% is to be levied and paid for each year of assessment upon such income as the Minister may specify of an approved shipping investment manager derived by it on or after 1 March 2006 from —| (a) | managing an approved shipping investment enterprise; or | | (b) | such other services or activities carried out for an approved shipping investment enterprise as may be prescribed. |
| (2) Regulations made under subsection (1) may provide for the deduction of losses otherwise than in accordance with section 37(3). |
| (3) The Minister or an authorised body may, subject to such conditions as the Minister or authorised body may impose, approve a shipping investment manager as an approved shipping investment manager for the purposes of this section. [32/2019] [Act 41 of 2020 wef 12/04/2024] |
| (4) Approval of a shipping investment manager under this section may be granted between 1 March 2006 and 28 February 2011 (both dates inclusive). [37/2014] |
| (4A) Approval of a shipping investment manager under this section may be granted between 1 March 2011 and 31 December 2026 (both dates inclusive) for such period not exceeding 5 years as the Minister or authorised body may specify, except that the Minister or authorised body may extend the period so specified for such further periods as the Minister or authorised body thinks fit. [37/2014; 2/2016; 41/2020] [Act 27 of 2021 wef 12/04/2024] |
(5) In this section —| “approved” means approved by the Minister or an authorised body; [Act 41 of 2020 wef 12/04/2024] |
| “shipping investment enterprise” has the meaning given by section 13P; |
| “shipping investment manager” means any company incorporated in Singapore. [43W |
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| Concessionary rate of tax for trust income to which beneficiary is entitled |
43M.—(1) Where any beneficiary of a trust who is resident in Singapore is entitled to any share of the statutory income of the trust, that share is, if it would have been subject to a concessionary rate of tax under any provision of this Part had it been derived or received directly by the beneficiary rather than the trustee of the trust, subject to the same concessionary rate of tax.(2) This section does not apply to —| (a) | any income of a real estate investment trust within the meaning of section 43(10); | | (b) | any income of a designated unit trust within the meaning of section 35(14); | | (c) | [Deleted by Act 37 of 2014] | | (d) | any income of a trust fund prescribed under section 13C; | | (e) | any income of a foreign trust specified under section 13F; | | (f) | any income of a locally‑administered trust prescribed under section 13N; | | (g) | any income of a trust the trustee of which is a prescribed person under section 13D; or | | (h) | any income of an approved trust fund referred to in the definition of “approved person” under section 13U(5), or of a trust fund that is a feeder fund or master fund approved under section 13U. [43X [37/2014] |
|
|
| Concessionary rate of tax for estate income received by beneficiary, etc. |
| 43MA. Where any person resident in Singapore is a beneficiary of an estate administered in Singapore, and any share of the statutory income of the estate is received by, distributed to or applied to the benefit of that person, that share is, if it would have been subject to a concessionary rate of tax under any provision of this Part had it been derived or received directly by that person instead of the executor of the estate, subject to the same concessionary rate of tax. [Act 30 of 2023 wef 30/10/2023] |
| Concessionary rate of tax for leasing of aircraft and aircraft engines |
43N.—(1) Despite section 43, tax at the following rate is to be levied, and paid, for each year of assessment upon the income of an approved aircraft leasing company accruing in or derived from Singapore in respect of the leasing of any aircraft or aircraft engine or such other activity as the Minister may by regulations prescribe:| (a) | where the company is approved before 1 April 2017, 5% or 10%, as specified by the Minister or such person as the Minister may appoint; | | (b) | where the company is approved between 1 April 2017 and 16 February 2024 (both dates inclusive), 8%; [Act 35 of 2024 wef 01/01/2024] | | (c) | where the company is approved on or after 17 February 2024, 8% or 10%, as specified by the Minister or an authorised body to the company; [Act 35 of 2024 wef 01/01/2024] | | (d) | where subsection (1D) applies, the substituted concessionary rate mentioned in that subsection but only for income derived from (and including) the date specified by the Minister or authorised body to the company for the application of that rate, which may be a date earlier than the notice mentioned in that subsection but not earlier than 1 January 2024. [39/2017] [Act 35 of 2024 wef 01/01/2024] |
(1A) Despite subsection (1), where —| (a) | a company was approved as an approved aircraft leasing company on or before 31 March 2017; | | (b) | the company is approved again as an approved aircraft leasing company at any time on or after 1 April 2017; | | (c) | the period of approval in paragraph (b) (called in this subsection the current approval period) starts immediately upon the expiry of the period of the approval in paragraph (a) (called in this subsection the previous approval period); and | | (d) | the company elects to apply the concessionary rate of tax specified to it under subsection (1)(a) for the previous approval period, to the company’s income that accrues in or is derived from Singapore between the date of commencement of the current approval period and 31 December 2027 (both dates inclusive), in respect of an aircraft or aircraft engine to which this subsection applies, |
| then that concessionary rate of tax applies to such income if the company remains an approved aircraft leasing company at the time the income accrues to or is derived by the company. |
[45/2018] |
| (1AA) To avoid doubt, the approval in subsection (1A)(b) includes an approval made under subsection (2) as in force immediately before the date of commencement of section 61(26) of the Income Tax (Amendment) Act 2020. [Act 41 of 2020 wef 12/04/2024] |
(1B) Subsection (1A) —| (a) | applies to an aircraft or aircraft engine that the company either owned (whether legally or beneficially) or of which it was a lessee under a finance lease treated as a sale under section 10C, as at the last day of the previous approval period; and | | (b) | does not apply to any aircraft or aircraft engine that —| (i) | has been disposed of by the company after that day and then re‑acquired by or leased back to the company; or | | (ii) | has not been delivered to the company as of that day. [45/2018] |
|
|
| (1C) The election under subsection (1A) must be made by written notice to the Comptroller at the time of lodgment of the return of income for the year of assessment relating to the basis period in which the approval in subsection (1A)(b) is given or within such extended time as the Comptroller may allow. [45/2018] |
| (1D) The Minister or an authorised body may, on or after 17 February 2024, on the Minister’s or authorised body’s own initiative or on the application of the approved aircraft leasing company, by notice to the company substitute the concessionary rate of tax applicable to the company under subsection (1)(b) or (c) or (1A) with 8% or 10% (as the case may be), for the remaining part of the period in subsection (3). [Act 35 of 2024 wef 01/01/2024] |
| (2) The Minister or an authorised body may, subject to such conditions as the Minister or authorised body may impose, approve an aircraft leasing company as an approved aircraft leasing company for the purposes of this section. [32/2019] [Act 41 of 2020 wef 12/04/2024] |
| (3) Tax at the concessionary rate of the income of an approved aircraft leasing company under subsection (1) is for a period not exceeding 5 years, except that the Minister or an authorised body may extend that period for a further period or periods, each of which must not exceed 5 years. [Act 41 of 2020 wef 12/04/2024] |
| (4) Approval may be granted under this section between 1 March 2007 and 31 December 2027 (both dates inclusive). [37/2014; 39/2017] [Act 33 of 2022 wef 04/11/2022] |
(5) In determining the income of an approved aircraft leasing company from the leasing of any aircraft or aircraft engine —| (a) | the allowances under section 19, 19A, 20, 21, 22 or 23 must be taken into account even if no claim for such allowances has been made; | | (b) | the allowances under section 19, 19A, 20, 21, 22 or 23 in respect of finance leasing in any year of assessment must be deducted against the income from such leasing for that year of assessment, and any balance of the allowances is not, subject to paragraph (c), available as a deduction against any other income or available for transfer under section 37B; | | (c) | where the approved aircraft leasing company ceases to derive income from finance leasing in the basis period for any year of assessment, any balance of the allowances in respect of finance leasing after the deduction against the income from such leasing is available as a deduction against any other income for that year of assessment and for any subsequent year of assessment in accordance with section 23; and | | (d) | the Comptroller must determine the manner and extent to which —| (i) | allowances under section 19, 19A, 20, 21, 22 or 23 and any expenses and donations allowable under this Act are to be deducted; and | | (ii) | any loss may be deducted under section 37. |
|
|
| (6) Subsection (5) applies, with the necessary modifications, in determining the income of an approved aircraft leasing company from any activity prescribed by regulations made under subsection (1) as if such income were income from operating leasing. |
(7) In this section —| “aircraft leasing company” means a company incorporated and resident in Singapore or a registered business trust, carrying on a business of leasing aircraft or aircraft engines; |
| “finance leasing”, in relation to any aircraft or aircraft engine, means a lease of the aircraft or aircraft engine (including any arrangement or agreement in connection with the lease) which has the effect of transferring substantially the obsolescence, risks or rewards incidental to ownership of such aircraft or aircraft engine to the lessee; |
| “leasing of any aircraft or aircraft engine” means the leasing of any aircraft or aircraft engine, other than one which has been treated as though it had been sold pursuant to regulations made under section 10C(1); |
| “operating leasing”, in relation to any aircraft or aircraft engine, means the leasing of the aircraft or aircraft engine, other than finance leasing. [43Y [32/2019] |
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| Concessionary rate of tax for aircraft investment manager |
43O.—(1) Despite section 43, the Minister may by regulations provide that tax at the rate of 10% is to be levied and paid for each year of assessment upon such income as the Minister may specify of an approved aircraft investment manager derived by it on or after 1 March 2007 from —| (a) | managing an approved aircraft leasing company; or | | (b) | such other services or activities carried out for an approved aircraft leasing company as may be prescribed by regulations. |
| (2) Regulations made under subsection (1) may provide for the deduction of losses otherwise than in accordance with section 37(3). |
| (3) The Minister or an authorised body may, subject to such conditions as the Minister or authorised body may impose, approve an aircraft investment manager as an approved aircraft investment manager for the purposes of this section. [32/2019] [Act 41 of 2020 wef 12/04/2024] |
| (4) Approval may be granted under this section between 1 March 2007 and 31 December 2027 (both dates inclusive). [37/2014; 39/2017] [Act 33 of 2022 wef 04/11/2022] |
(5) In this section —| “aircraft investment manager” means any company incorporated in Singapore; |
| “aircraft leasing company” has the meaning given by section 43N; |
| “approved” means approved by the Minister or an authorised body. [Act 41 of 2020 wef 12/04/2024] [43Z |
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| Concessionary rate of tax for container investment enterprise |
43P.—(1) Despite section 43 but subject to subsection (5), tax at the rate of 5% or 10% as the Minister or an authorised body may specify, is to be levied and paid for each year of assessment upon the income of an approved container investment enterprise accruing in or derived from Singapore from —| (a) | the leasing of any container owned by the enterprise acquired before or during the period of approval of the enterprise mentioned in subsection (4) and used for the international transportation of goods; | | (b) | foreign exchange and risk management activities which are carried out in connection with and incidental to the leasing mentioned in paragraph (a); | | (c) | for the year of assessment 2013 and subsequent years of assessment, the leasing of any intermodal equipment owned by the enterprise acquired before or during the period of approval of the enterprise mentioned in subsection (4), which is incidental to the leasing mentioned in paragraph (a); | | (d) | for the year of assessment 2013 and subsequent years of assessment, foreign exchange and risk management activities which are carried out in connection with and incidental to the leasing mentioned in paragraph (c); | | (e) | the leasing of any container used for international transportation of goods, if the container was —| (i) | acquired by an approved related party before or during the period of the approval of the related party under subsection (4); and | | (ii) | leased by the approved related party to the approved container investment enterprise; |
| | (f) | the leasing of any intermodal equipment that is incidental to the lease mentioned in paragraph (e), if the intermodal equipment was —| (i) | acquired by an approved related party before or during the period of the approval of the related party under subsection (4); and | | (ii) | leased by the approved related party to the approved container investment enterprise; and |
| | (g) | foreign exchange and risk management activities that are carried out in connection with and incidental to the leases mentioned in paragraphs (e) and (f). [32/2019] [Act 41 of 2020 wef 12/04/2024] |
| (1A) Subsection (1)(e), (f) and (g) only applies to income derived on or after 12 December 2018. [32/2019] |
| (2) Subsection (1)(a), (b), (c) or (d) continues to apply to a container investment enterprise the approval of which has expired or been withdrawn, but which continues to derive income of the type mentioned in that provision in relation to a container or an intermodal equipment acquired before or during the period of approval of the enterprise, provided that the enterprise has by the date of the expiry or before the withdrawal of its approval fulfilled all the conditions mentioned in subsection (4), and any reference in this section to an approved container investment enterprise is to be construed accordingly. [32/2019] |
| (2A) Subsection (1)(e), (f) or (g) continues to apply to a container investment enterprise the approval of which has expired or been withdrawn, but that continues to derive income of the type mentioned in that provision if both the container investment enterprise and the approved related party have by the date of the expiry or before the withdrawal, fulfilled all the conditions of their respective approvals under subsection (4). [32/2019] |
| (2B) For the purpose of subsection (2A), the container investment enterprise is treated under this section as an approved container investment enterprise. [32/2019] |
| (2C) Subsection (1)(a), (c), (e) and (f) does not apply to income derived on or after 12 December 2018 from the leasing of a container or intermodal equipment that is acquired by the approved container investment enterprise or the approved related party by way of a finance lease entered into with an entity that is not an approved related party. [32/2019] |
| (3) The Minister or an authorised body may, at any time between 1 April 2008 and 31 December 2026 (both dates inclusive), approve a container investment enterprise or a related party of an approved container investment enterprise for the purposes of subsection (1). [37/2014; 2/2016; 32/2019; 41/2020] [Act 41 of 2020 wef 12/04/2024] |
(4) The approval under subsection (3) is subject to such conditions as the Minister may specify, and must —| (a) | where the approval is granted during the period between 1 April 2008 and 28 February 2011 (both dates inclusive), be for such period not exceeding 10 years, as the Minister may specify; and | | (b) | where the approval is granted during the period between 1 March 2011 and 31 December 2026 (both dates inclusive), be for such period not exceeding 5 years, as the Minister may specify, |
| except that the Minister may extend the period so specified for such further periods as the Minister thinks fit. |
[37/2014; 2/2016; 41/2020] |
| (4A) A reference to the Minister in subsection (4), in the case of an approval granted on or after the date of commencement of section 38(1)(a) of the Income Tax (Amendment) Act 2021, includes the authorised body. [Act 27 of 2021 wef 12/04/2024] |
| (5) The Minister or an authorised body may, in respect of any container, class of containers, intermodal equipment or class of intermodal equipment, specify a period not exceeding a period of 15 years, during which the income from the leasing of such container, class of containers, intermodal equipment or class of intermodal equipment is subject to the applicable concessionary tax rate under subsection (1). [Act 41 of 2020 wef 12/04/2024] |
(6) In determining the income of an approved container investment enterprise from the leasing of any container or intermodal equipment —| (a) | the allowances under section 19, 19A, 20, 21, 22 or 23 (other than allowances made to the lessee under regulations made under section 10C) must be taken into account even if no claim for such allowances has been made; | | (b) | the allowances under section 19, 19A, 20, 21, 22 or 23 (other than allowances made to the lessee under regulations made under section 10C) in respect of finance leasing in any year of assessment must be deducted against the income from such leasing for that year of assessment, and any balance of the allowances is not, subject to paragraph (c), available as a deduction against any other income or available for transfer under section 37B; | | (c) | where the approved container investment enterprise ceases to derive income from finance leasing in the basis period for any year of assessment, any balance of the allowances in respect of finance leasing after the deduction against the income from such leasing is available as a deduction against any other income for that year of assessment and for any subsequent year of assessment in accordance with section 23; and | | (d) | the Comptroller must determine the manner and extent to which —| (i) | allowances under section 19, 19A, 20, 21, 22 or 23 and any expenses and donations allowable under this Act are to be deducted; and | | (ii) | any loss may be deducted under section 37. [2/2016] |
|
|
(7) In this section —| “approved” means approved by the Minister or an authorised body; [Act 41 of 2020 wef 12/04/2024] |
| “container” means a sea‑container used for the international transportation of goods and that adheres to the standards defined by the Institute of International Container Lessors or the International Organization for Standardization for such sea‑container, or (for the year of assessment 2013 and subsequent years of assessment) by any of those organisations or any other equivalent organisation for such sea‑container; |
“container investment enterprise” means —| (a) | a company incorporated and resident in Singapore; or | | (b) | a registered business trust; |
|
| “finance leasing”, in relation to any container or intermodal equipment, means a lease of the container or intermodal equipment (including any arrangement or agreement in connection with the lease) which has the effect of transferring substantially the obsolescence, risks or rewards incidental to ownership of such container or intermodal equipment to the lessee; |
| “intermodal equipment” means any trailer, flatcar, car rack or other equipment, which facilitates the transportation of containers from one mode of transport to another; |
| “registered business trust” has the meaning given by the Business Trusts Act 2004; |
“related party”, in relation to an approved container investment enterprise, means —| (a) | any entity that is related to the approved container investment enterprise in such manner as may be prescribed by rules made under section 7; or | | (b) | any other entity that is approved by the Minister or authorised body in any particular case to be a related party of the approved container investment enterprise. [32/2019; 27/2021] [Act 27 of 2021 wef 12/04/2024] |
|
|
| (8) Rules made for the purpose of the definition of “related party” in subsection (7) may be made to take effect from (and including) 12 December 2018. [43ZA [32/2019] |
|
| Concessionary rate of tax for container investment manager |
43Q.—(1) Despite section 43, the Minister may by regulations provide that tax at the rate of 10% is to be levied and paid for each year of assessment upon such income as the Minister may specify of an approved container investment manager derived by it on or after 1 April 2008 from —| (a) | managing an approved container investment enterprise; or | | (b) | such other services or activities carried out for an approved container investment enterprise as may be prescribed. |
| (2) Regulations made under subsection (1) may provide for the deduction of losses otherwise than in accordance with section 37(3). |
| (3) The Minister or an authorised body may, subject to such conditions as the Minister or authorised body may impose, approve a container investment manager as an approved container investment manager for the purposes of this section. [32/2019] [Act 41 of 2020 wef 12/04/2024] |
| (4) Approval of a container investment manager under this section may be granted between 1 April 2008 and 28 February 2011 (both dates inclusive). [37/2014] |
| (4A) Approval of a container investment manager under this section may be granted between 1 March 2011 and 31 December 2026 (both dates inclusive) for such period not exceeding 5 years as the Minister or authorised body may specify, except that the Minister or authorised body may extend the period so specified for such further periods as the Minister or authorised body thinks fit. [37/2014; 2/2016; 41/2020] [Act 27 of 2021 wef 12/04/2024] |
(5) In this section —| “approved” means approved by the Minister or an authorised body; [Act 41 of 2020 wef 12/04/2024] |
| “container investment enterprise” has the meaning given by section 43P; |
| “container investment manager” means any company incorporated in Singapore. [43ZB |
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| Concessionary rate of tax for approved insurance brokers |
| 43R.—(1) Despite section 43, the Minister may by regulations provide that tax at the rate of 10% is to be levied and paid for each year of assessment upon such income of an approved insurance broker as the Minister may specify that is derived by it on or after a prescribed date from the provision of such direct insurance broking, reinsurance broking or advisory services relating to the insurance sector as may be prescribed. [45/2018] | (2) Regulations made under subsection (1) may provide for the deduction of losses otherwise than in accordance with section 37(3). |
| (3) The Minister or an authorised body may, subject to such conditions as the Minister or authorised body may impose, approve a company that is a direct insurance broker, general reinsurance broker or life reinsurance broker, as an approved insurance broker for the purposes of this section. [32/2019] [Act 41 of 2020 wef 06/12/2022] |
| (4) Approval may be granted under this section between 1 April 2008 and 31 December 2028 (both dates inclusive). [37/2014; 45/2018] [Act 30 of 2023 wef 30/10/2023] |
| (5) In this section, “direct insurance broker”, “general reinsurance broker” and “life reinsurance broker” have the meanings given by section 2 of the Insurance Act 1966. [43ZC [32/2019] |
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| Concessionary rate of tax for income derived from managing qualifying registered business trust or company |
43S.—(1) Despite section 43, the Minister may by regulations provide that tax at the rate of 10% is to be levied and paid for each year of assessment upon such income as the Minister may specify derived on or after 1 April 2008 —| (a) | by an approved trustee‑manager of a qualifying registered business trust from providing services in such capacity in respect of such infrastructure asset or project situated outside Singapore as may be prescribed by regulations (called in this section a prescribed offshore infrastructure asset or project); and | | (b) | by an approved fund management company from —| (i) | managing a qualifying company in respect of any prescribed offshore infrastructure asset or project; or | | (ii) | arranging, on behalf of a qualifying company, any loan of designated securities under a securities lending arrangement in writing to another qualifying company. |
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| (2) Regulations made under subsection (1) may provide for the deduction of losses otherwise than in accordance with section 37(3). |
(3) For the purposes of this section, the Minister or an authorised body may, subject to such conditions as the Minister or authorised body may impose —| (a) | approve a trustee‑manager of a qualifying registered business trust as an approved trustee‑manager; or | | (b) | approve a fund management company as an approved fund management company. [32/2019] [Act 41 of 2020 wef 06/12/2022] |
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| (4) Approval may be granted under this section between 1 April 2008 and 31 December 2022 (both dates inclusive). [37/2014; 39/2017] |
(5) In this section —“designated securities” means —| (a) | stocks, shares, bonds or other securities, denominated in any foreign currency, issued by a company which is neither incorporated in Singapore nor resident in Singapore; or | | (b) | bonds denominated in any foreign currency issued by any foreign government; |
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| “fund management company” means any company incorporated in Singapore; |
“qualifying company”, in relation to an approved fund management company, means any company incorporated in Singapore which —| (a) | is listed or to be listed on any exchange in Singapore within one year from the date the approved fund management company is so approved; and | | (b) | owns any offshore infrastructure asset or any asset used in an offshore infrastructure project, or debt securities or shares of any company that owns any offshore infrastructure asset or any asset used in an offshore infrastructure project; |
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“qualifying registered business trust”, in relation to an approved trustee‑manager, means any registered business trust which —| (a) | is listed or to be listed on any exchange in Singapore within one year from the date the approved trustee‑manager is so approved; and | | (b) | owns any offshore infrastructure asset or any asset used in an offshore infrastructure project, or debt securities or shares of any company that owns any offshore infrastructure asset or any asset used in an offshore infrastructure project; |
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| “registered business trust” and “trustee‑manager” have the meanings given by the Business Trusts Act 2004. [43ZD [32/2019] |
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| Concessionary rate of tax for ship broking and forward freight agreement trading |
43T.—(1) Despite section 43, tax at the rate of 10% is to be levied and paid for each year of assessment upon such amount of —| (a) | fees or commissions derived in the period between 1 April 2010 and 31 May 2011 (both dates inclusive) by an approved company from ship broking; and | | (b) | gains derived in the period between 1 April 2010 and 31 May 2011 (both dates inclusive) by an approved company from forward freight agreement trading, |
| which in the aggregate are in excess of the base amount. |
| (2) Approval may be granted under this section between 1 April 2010 and 31 May 2011 (both dates inclusive) to a company for a period of 5 years, subject to such conditions as the Minister may impose. [37/2014] |
(3) The base amount mentioned in subsection (1) is —| (a) | where the approved company had carried out the ship broking or forward freight agreement trading or both (called in this paragraph such activity) in Singapore at any time during the period of 3 years immediately preceding the date on which approval is granted under this section, the amount ascertained by dividing the net profit before tax as shown in the audited accounts of the approved company that is derived from carrying out such activity during that period by the actual number of months in that period in which such activity was carried out and multiplying by 12; | | (b) | where the approved company had not carried out the ship broking or forward freight agreement trading in Singapore, at any time during the period of 3 years immediately preceding the date on which approval is granted under this section, zero; or | | (c) | such amount as the Minister may specify in substitution for the amount mentioned in paragraph (a) or (b). |
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(4) In determining the income of an approved company from the carrying out of ship broking or forward freight agreement trading or both in Singapore —| (a) | the allowances under section 19, 19A, 20, 21, 22 or 23 must be taken into account even if no claim for such allowances has been made; and | | (b) | the Comptroller must determine the manner and extent to which —| (i) | allowances under section 19, 19A, 20, 21, 22 or 23 and any expenses and donations allowable under this Act are to be deducted; and | | (ii) | any loss may be deducted under section 37. |
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(5) In this section —“approved company” means a company which —| (a) | is incorporated and resident in Singapore; | | (b) | carries on the business of ship broking or forward freight agreement trading or both in Singapore; and | | (c) | is approved by the Minister, or such person as the Minister may appoint, for the purpose of this section; |
|
| “forward freight agreement trading” means the undertaking of a position under a forward freight agreement trade where such trade is in connection with shipping freight rates; |
“ship broking” means —| (a) | the broking of sale and purchase of vessels (including the activity of valuing the vessels); | | (b) | the matching of vessel owners (which intend to build new vessels) to shipyards based on the vessel owners’ requirements; | | (c) | the matching of vessels to —| (i) | cargoes; or | | (ii) | vessel owners and vessel charterers; |
| | (d) | the valuation of vessels; or | | (e) | the matching of forward freight agreement traders where the forward freight agreement trade is in connection with shipping freight rates, |
| and includes the provision of research, consultancy or advisory services using information derived from the business of carrying on any of the activities referred to in paragraphs (a) to (e), where the total sum of the fees (called in this definition the said sum) derived by the approved company from the research, consultancy and advisory services in the basis period for the year of assessment concerned is not more than 20% of the sum of — |
| (f) | the total fees and commissions derived by the approved company from all of the activities referred to in paragraphs (a) to (e) in the basis period for that year of assessment; and | | (g) | the said sum, |
| unless the Minister otherwise allows. |
[43ZE |
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| Concessionary rate of tax for shipping‑related support services |
| 43U.—(1) Despite section 43, tax at the rate of 10% is to be levied and paid for each year of assessment upon the amount of income in subsection (1A) of an approved company derived on or after the service approval date and during the period of its approval under subsection (2) (but not any extended period of its approval under subsection (5A)), from providing in or from Singapore any shipping‑related support service approved for it under subsection (2A). [2/2016] | (1A) In subsection (1), the amount of the income is that which exceeds the base amount calculated in accordance with subsection (4). [2/2016] |
| (2) Approval may be granted under this section between 1 June 2011 and 31 December 2026 (both dates inclusive) to a company for a period of 5 years; and may be given subject to such conditions as the Minister or authorised body may impose. [37/2014; 2/2016; 41/2020] [Act 27 of 2021 wef 12/04/2024] |
| (2A) The Minister or authorised body must approve for the company one or more shipping‑related support services for the purposes of subsection (1) at the time of granting the approval, and may approve for the company additional shipping‑related support services during the period it is approved. [2/2016] [Act 41 of 2020 wef 12/04/2024] |
| (3) A company that is deemed an approved company on 1 June 2011 by virtue of regulations made under subsection (7), is deemed to have been approved for such period not exceeding 10 years from that date as the Minister may specify in the regulations. |
(4) The base amount mentioned in subsection (1A) or (5E) is calculated in accordance with the following provisions:| (a) | where the approved company had provided one or more of the shipping‑related support services approved for it at any time during the period of 3 years immediately before the date of its approval, the base amount is ascertained by dividing the aggregate net profit before tax as shown in its audited accounts (or such other accounts as the Minister or authorised body may approve for the company) that is derived from providing all of those services during that period by the actual number of months (a period of less than a month being reckoned as one month) during that period in which those services were provided and multiplying by 12; [Act 41 of 2020 wef 12/04/2024] | | (b) | where the company had not provided any of the shipping‑related support services approved for it at any time during the period of 3 years immediately before the date of its approval, the base amount is zero; or | | (c) | such amount as the Minister may specify in substitution for the amount mentioned in paragraph (a) or (b). [2/2016; 41/2020] |
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| (5) The base amount determined in accordance with subsection (4) applies to the approved company for the entire duration of the period of its approval (but not any extended period of its approval under subsection (5A)), unless the Minister otherwise decides. [2/2016; 41/2020] |
| (5A) The Minister or authorised body may extend the period of any approval under subsection (2) for further periods of 5 years at any one time, and the extension is subject to the company satisfying such conditions as the Minister or authorised body has imposed on it at the time of granting the extension. [2/2016] [Act 41 of 2020 wef 12/04/2024] |
| (5B) The Minister or authorised body must approve for the company one or more shipping‑related support services for the purposes of subsection (5C) or (5CA) at the time of granting the extension, and may approve for the company additional shipping‑related support services during any extended period of its approval. [2/2016; 41/2020] [Act 41 of 2020 wef 12/04/2024] |
| (5C) Despite section 43, where an approved company whose period of approval is extended under subsection (5A) did not make an election under subsection (5F) for the extended period, then tax at the rate of A% is levied and must be paid for each year of assessment upon the amount of its income in subsection (5D) that is derived on or after the service approval date and during the extended period, from providing in or from Singapore any shipping‑related support service approved for it under subsection (5B). [41/2020] |
| (5CA) Despite section 43, where an approved company whose period of approval is extended under subsection (5A) made an election under subsection (5F) for the extended period, then tax at the rate of (0.5 + A)% is levied and must be paid for each year of assessment upon the amount of its income in subsection (5E) that is derived on or after the service approval date and during the extended period, from providing in or from Singapore any shipping‑related support service approved for it under subsection (5B). [41/2020] |
| (5CB) In subsections (5C) and (5CA), “A” is the concessionary rate of tax applicable to the income of the approved company from providing in or from Singapore any shipping‑related support service approved for it under subsection (2A) or (5B) (as the case may be) immediately before the commencement of the extended period concerned of its approval under subsection (5A). [41/2020] |
| (5D) In subsection (5C), the amount of the income is that which exceeds the base amount calculated in accordance with subsection (5I). [2/2016] |
| (5E) In subsection (5CA), the amount of the income is that which exceeds the base amount immediately before the commencement of the extended period concerned of its approval under subsection (5A), which is calculated in accordance with subsection (4) or (5I), as the case may be. [41/2020] |
| (5F) An approved company whose period of approval is extended under subsection (5A) may make an election for an amount of its income mentioned in subsection (5CA) that is derived on or after the service approval date and during the extended period, from providing in or from Singapore any shipping‑related support service approved for it under subsection (5B), to be taxed in accordance with subsection (5CA). [41/2020] |
| (5G) An election under subsection (5F) must be made in such form and manner and within such reasonable time as the Minister or authorised body may allow, and must be accompanied by such particulars as the Minister or authorised body determines. [2/2016; 41/2020] [Act 41 of 2020 wef 12/04/2024] |
| (5H) An election under subsection (5F) is irrevocable for the extended period of its approval in which the election is made. [41/2020] |
(5I) The base amount mentioned in subsection (5D) or (5E) is determined as follows:| (a) | where the approved company had provided one or more of the shipping‑related support services approved for it under subsection (5B) at any time during the period of 3 years immediately before the date the extension is granted under subsection (5A), the base amount is ascertained by the formula | | is the total net profit before tax as shown in the company’s audited accounts (or such other accounts as the Minister or authorised body may approve for the company) that is derived from providing all of those services during that period of 3 years; and |
| | | is the actual number of months (a period of less than a month being reckoned as one month) during that period in which those services were provided; |
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[Act 41 of 2020 wef 12/04/2024] | | (b) | where the company had not provided any of the shipping‑related support services approved for it under subsection (5B) at any time during the period mentioned in paragraph (a), the base amount is zero; | | (c) | the Minister may in a particular case specify an amount in substitution for the amount mentioned in paragraph (a) or (b). [2/2016; 41/2020] |
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| (5J) The base amount determined in accordance with subsection (5I) applies to the approved company for the entire duration of the extended period concerned of its approval under subsection (5A), unless the Minister otherwise decides. [2/2016; 41/2020] |
(6) In determining the income of an approved company from the provision of shipping‑related support services approved for it —| (a) | the allowances under section 19, 19A, 20, 21, 22 or 23 must be taken into account even if no claim for such allowances has been made; and | | (b) | the Comptroller must determine the manner and extent to which —| (i) | allowances under section 19, 19A, 20, 21, 22 or 23 and any expenses and donations allowable under this Act are to be deducted; and | | (ii) | any loss may be deducted under section 37. |
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(7) For the purposes of this section, the Minister may make regulations —| (a) | to deem a company which, immediately before 1 June 2011, was —| (i) | a development and expansion company within the meaning of section 20 of the Economic Expansion Incentives (Relief from Income Tax) Act 1967 engaged in ship management services, ship agency, logistics or freight forwarding, being activities prescribed as qualifying activities within the meaning of that section, and which, in the case of a company engaged in logistics or freight forwarding, is a company —| (A) | whose operations are or can be controlled, directly or indirectly, by another company, being one that owns or operates ships; | | (B) | which controls or can control, directly or indirectly, the operations of such other company; or | | (C) | whose operations are or can be controlled, directly or indirectly, by a person or persons who control or can control, directly or indirectly, the operations of such other company; or |
| | (ii) | an approved company under section 43T, |
| as an approved company for the purpose of this section from that date; |
| | (b) | to provide for such transitional, supplementary and consequential matters as the Minister may consider necessary or expedient in relation to a company mentioned in paragraph (a), including providing a different base amount for the purposes of subsection (1); and | | (c) | generally to give effect to or to carry out the purposes of this section. |
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(8) In this section —| “approved” means approved by the Minister or an authorised body; [Act 41 of 2020 wef 12/04/2024] |
“approved company” means a company which —| (a) | is incorporated and resident in Singapore; | | (b) | carries on the business of providing shipping‑related support services; and | | (c) | is approved for the purpose of this section; |
|
| “approved related company”, in relation to an approved company, means a related company approved at any time for the approved company for the purpose of the definition of “corporate service”; |
| “container” has the meaning given by section 43P(7); |
“corporate service” means any of the following services provided by an approved company to an approved related company:| (a) | sourcing, procurement and distribution of materials and components, products or services for use in the business of the approved related company (excluding marketing control, planning and brand management); | | (b) | training of crew and staff; | | (c) | crew management (such as recruitment and selection of qualified and trained seafarers, budgeting and strategic planning in relation to crew requirements, overseeing crew welfare, managing relations with labour unions, handling insurance matters relating to crew, and maintaining personnel data to facilitate searches, planning and analysis); | | (d) | business planning, development and co‑ordination (including the performance of economic or investment research and analysis) of information and processes to improve standards of services or products; | | (e) | [Deleted by Act 39 of 2017] | | (f) | general management and administration (such as risk management, internal audit, budgeting and forecasting, but excluding intellectual property management); | | (g) | technical support services (such as marine and offshore engineering technical support, accounting and tax consultancy services and actuary services); | | (h) | human resource services; | | (i) | financial and treasury services (such as providing credit administration and control, arranging credit facilities, managing funds, and providing guarantees, performance bonds, standby letters of credit and services relating to remittances, arranging interest and currency swaps); | | (j) | legal services; | | (k) | corporate finance advisory services; | | (l) | information technology support services, |
| and only services provided to an approved related company of that company are treated as “corporate service” in determining if the approved company has provided shipping‑related support service which is corporate service for the purposes of subsections (4) and (5I); |
|
| “finance leasing” has the meaning given by section 13P(20) or 43P(7); |
| “forward freight agreement trading” means the undertaking of a position under a forward freight agreement trade where such trade is in connection with shipping freight rates; |
| “freight forwarding and logistics service” means managing a customer’s freight, supply chain or logistics process flow; |
| “prescribed ship management services” has the meaning given by section 13A(16); |
“related company”, in relation to an approved company, means a company that is carrying on a shipping‑related business and —| (a) | whose operations are or can be controlled, directly or indirectly, by the approved company; | | (b) | which controls or can control, directly or indirectly, the operations of the approved company; or | | (c) | whose operations are or can be controlled, directly or indirectly, by a person or persons who control or can control, directly or indirectly, the operations of the approved company; |
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| “service approval date”, in relation to any shipping‑related support service approved for an approved company under subsection (2A) or (5B), means the date the service is approved for that company under that subsection or, in the case of corporate service to be provided by the company to its approved related company, the date the related company is approved as such; |
| “ship” has the meaning given by section 2(1) of the Merchant Shipping Act 1995; |
| “ship agency” means the activities performed on behalf of a shipping enterprise in relation to their vessels, masters and crews, cargoes and customers; |
“ship broking” means —| (a) | the broking of sale and purchase of vessels (including the activity of valuing the vessels); | | (b) | the matching of vessel owners (which intend to build new vessels) to shipyards based on the vessel owners’ requirements; | | (c) | the matching of vessels to —| (i) | cargoes; or | | (ii) | vessel owners and vessel charterers; |
| | (d) | the valuation of vessels; or | | (e) | the matching of forward freight agreement traders where the forward freight agreement trade is in connection with shipping freight rates, |
| and includes the services mentioned in subsection (9); |
|
“shipping‑related business” means any of the following:| (a) | carriage of passengers, mail, livestock or goods by any ship; | | (b) | charter or finance leasing of any ship to any person; | | (c) | use of any ship as a dredger, seismic ship or ship used for offshore oil and gas activity; | | (d) | use of any ship for towing or salvage operations; | | (e) | leasing (including finance leasing) of any container used for the international transportation of goods; | | (f) | managing an entity which is in the business of carrying on the charter or leasing (including finance leasing) of containers used for the international transportation of goods, or ships; | | (g) | ship broking; | | (h) | forward freight agreement trading; | | (i) | ship agency; | | (j) | prescribed ship management services; | | (k) | freight and logistics services in respect of a ship; | | (l) | marine insurance; | | (m) | offshore and marine engineering (including ship repair and conversion, ship building and offshore engineering); | | (n) | maritime law and arbitration; | | (o) | shipping finance; | | (p) | maritime research and development; | | (q) | use of any ship for offshore renewable energy activity or offshore mineral activity; |
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“shipping‑related support service” means any of the following:| (a) | ship broking; | | (b) | forward freight agreement trading; | | (c) | prescribed ship management services; | | (d) | ship agency; | | (e) | freight forwarding and logistics service; | | (f) | corporate service. [2/2016; 34/2016; 39/2017] |
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(9) In this section, “ship broking” includes —| (a) | for the purpose of subsections (1), (2A), (5B), (5C) and (5CA), the provision of research, consultancy or advisory services using information derived from the business of carrying on any of the activities referred to in paragraphs (a) to (e) of the definition of “ship broking” in subsection (8), where the total sum of the fees derived by the approved company from the research, consultancy and advisory services in the basis period for the year of assessment concerned (called in this paragraph the said sum) is not more than 20% of the sum of —| (i) | the total fees and commissions derived by the approved company from all of those other activities in the basis period for that year of assessment; and | | (ii) | the said sum, |
| or where the Minister otherwise allows such services to be considered “ship broking”; and |
| | (b) | for the purpose of subsections (4) and (5I), the provision, within any financial year or part thereof of the approved company that falls within the period of 3 years immediately before the date of its approval, of research, consultancy or advisory services using information derived from the business of carrying on any of the activities referred to in paragraphs (a) to (e) of the definition of “ship broking” in subsection (8), where the total sum of the fees derived by the approved company from the research, consultancy and advisory services in that financial year or part thereof (called in this paragraph the said sum) is not more than 20% of the sum of —| (i) | the total fees and commissions derived by the approved company from all of those other activities in that financial year or part thereof; and | | (ii) | the said sum, |
| or where the Minister otherwise allows such services to be considered “ship broking”. |
[2/2016; 41/2020] |
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(10) For the purposes of the definition of “related company” in subsection (8), a company (called in this subsection the first company) is deemed to be a related company of another company if —| (a) | at least 25% of the total number of its issued shares are beneficially owned, directly or indirectly, by the other company; | | (b) | at least 25% of the total number of the issued shares of the other company are beneficially owned, directly or indirectly, by the first company; or | | (c) | at least 25% of the total number of issued shares in each of the 2 companies are beneficially owned, directly or indirectly, by a third company. [43ZF |
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| Concessionary rate of tax for income derived from managing approved venture company |
| 43V.—(1) Despite section 43, tax at the rate of 5% is to be levied and paid for each year of assessment upon the management fees and performance bonus derived by an approved fund management company on or after 1 April 2015 from managing authorised investments of an approved venture company under section 13G. [2/2016; 41/2020] | (2) The Minister or an authorised body may approve a fund management company for the purposes of subsection (1) at any time between 1 April 2015 and 31 December 2025 (both dates inclusive). [2/2016; 41/2020] [Act 41 of 2020 wef 12/04/2024] |
| (3) The Minister or authorised body may, when granting the approval, impose such conditions on the fund management company as the Minister or authorised body considers appropriate. [2/2016] [Act 41 of 2020 wef 12/04/2024] |
| (4) The approval under subsection (2) is for a period specified by the Minister or authorised body which must not exceed 10 years, except that the Minister or authorised body may extend the period for further periods not exceeding 5 years at any one time. [2/2016] [Act 41 of 2020 wef 12/04/2024] |
| (5) Despite subsection (4), an approval granted under subsection (2) on or after 1 April 2020, and any extension of such approval, must each be for a period that does not exceed 5 years. [41/2020] |
(6) In determining the amount of income subject to the concessionary rate of tax under subsection (1) —| (a) | the allowances under section 19, 19A, 20, 21, 22 or 23 must be taken into account even if no claim for such allowances has been made; and | | (b) | the Comptroller must determine the manner and extent to which —| (i) | allowances under section 19, 19A, 20, 21, 22 or 23 and any expenses and donations allowable under this Act are to be deducted; and | | (ii) | any loss may be deducted under section 37. [2/2016] |
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(7) In this section —| “authorised investments” has the meaning given by section 13G(18); |
| “fund management company” means a company incorporated in Singapore that is a fund manager. [43ZG [2/2016; 34/2016; 41/2020] |
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| Concessionary rate of tax for international growth company |
| 43W.—(1) Despite section 43, the Minister may by regulations provide that tax at the rate of 10% is to be levied and paid upon the income derived by an approved international growth company from carrying on all of its qualifying activities within a basis period, or a part of a basis period, that falls within its approval period, which in total exceeds the base amount mentioned in subsection (6). [2/2016] | (2) Subsection (1) does not apply to income from any of the activities mentioned in that subsection that is carried on a date that falls outside of that activity’s concessionary period. [2/2016] |
| (3) The Minister or such person as the Minister may appoint may, at any time between 1 April 2015 and 31 August 2017 (both dates inclusive), approve a company as an international growth company for a period not exceeding 5 years; and the approval may be given subject to such conditions as the Minister or appointed person may impose. [2/2016; 39/2017] |
(4) When granting the approval, the Minister or appointed person must specify for the international growth company —| (a) | the date of its approval and its approval period; | | (b) | one or more qualifying activities; and | | (c) | a concessionary period for each of those activities. [2/2016] |
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(5) The Minister or appointed person may at any time during the period the international growth company remains approved specify for it —| (a) | one or more additional qualifying activities; and | | (b) | a concessionary period for each of those activities. [2/2016] |
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(6) The base amount mentioned in subsection (1) is ascertained in accordance with the following provisions:| (a) | where the approved international growth company had, at any time during the period of 3 years immediately before the date of its approval, carried on one or more of the qualifying activities specified for it under subsection (4), the base amount is ascertained by the formula | | is the total net profit before tax as shown in its audited accounts (or such other accounts as the Minister or appointed person may approve for the company) that is derived from carrying on the qualifying activity or activities during that period; and |
| | | is the actual number of months (a period of less than a month being reckoned as one month) during that period in which the qualifying activity or activities was or were carried out; |
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| | (b) | where the approved international growth company had not carried on any of those qualifying activities during the period of 3 years immediately before the date of its approval, the base amount is zero; | | (c) | the Minister or appointed person may specify an amount in substitution for the amount mentioned in paragraph (a) or (b). [2/2016] |
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| (7) The base amount determined in accordance with subsection (6) applies for the entire duration of the company’s approval period, unless the Minister or appointed person decides otherwise. [2/2016] |
(8) In determining the income of an approved international growth company from carrying on its qualifying activities —| (a) | the allowances under section 16, 17, 18, 18B, 18C, 19, 19A, 20, 21, 22 or 23 must be taken into account even if no claim for such allowances has been made; and | | (b) | the Comptroller must determine the manner and extent to which —| (i) | allowances under section 16, 17, 18, 18B, 18C, 19, 19A, 20, 21, 22 or 23 and any expenses and donations allowable under this Act are to be deducted; and | | (ii) | any loss may be deducted under section 37. [2/2016] |
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(9) In this section —| “approval period”, in relation to an approved international growth company, means the period of its approval as such a company under subsection (3); |
| “concessionary period”, in relation to a qualifying activity of an approved international growth company, means the concessionary period specified for that activity under subsection (4) or (5); |
“international growth company” means a company incorporated and resident in Singapore which carries on, or which intends to carry on, a trade or business which involves —| (a) | the export of goods to a country outside Singapore; | | (b) | the performance of services in a country outside Singapore; or | | (c) | the performance of services for a person or permanent establishment outside Singapore, |
| whether or not it also carries on or intends to carry on any other trade or business; |
|
| “qualifying activity”, in relation to an approved international growth company, means an activity specified for the company under subsection (4) or (5), being one of the activities prescribed for the purposes of this section in regulations made under this section. [43ZH [2/2016] |
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| Concessionary rate of tax for intellectual property income |
43X.—(1) Despite section 43 and subject to this section, the concessionary rate of tax under subsection (5) applies for each year of assessment upon a percentage determined in accordance with regulations of qualifying intellectual property income of an approved company, that is derived —| (a) | from a qualifying IPR elected by the approved company for that year of assessment under subsections (7) and (8); and | | (b) | in so much of the basis period for that year of assessment as falls within the tax relief period applicable to the approved company. [45/2018] |
| (2) The Minister or an authorised body may approve a company as an approved company (subject to such terms and conditions as the Minister or authorised body may specify), but not after 31 December 2028. [45/2018] [Act 30 of 2023 wef 30/10/2023] [Act 41 of 2020 wef 12/04/2024] |
(3) The Minister or authorised body may —| (a) | specify an initial tax relief period for an approved company that does not exceed 10 years; | | (b) | specify a commencement date for the initial tax relief period that is not earlier than 1 July 2018; and | | (c) | extend the tax relief period for a further period or periods, not exceeding 10 years for each period, as the Minister or authorised body may determine. [45/2018] [Act 41 of 2020 wef 12/04/2024] |
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| (4) Where the commencement date for the initial tax relief period is a date before the company becomes an approved company, then for the purposes of subsection (1), the company is treated as an approved company beginning on the commencement date. [45/2018] |
(5) For the purpose of subsection (1), the concessionary rate of tax for an approved company is a rate determined in accordance with the formula A + B, where —| (a) | if the company is approved before 17 February 2024 — A is a base rate of 5% or 10%, as specified by the Minister or authorised body to the approved company; [Act 35 of 2024 wef 01/01/2024] | | (b) | if the company is approved on or after 17 February 2024 — A is a base rate of 5%, 10% or 15%, as specified by the Minister or authorised body to the approved company; [Act 35 of 2024 wef 01/01/2024] | | (c) | if subsection (6A) applies — A is the substituted base rate mentioned in that subsection but only for income derived from (and including) the date specified by the Minister or authorised body to the approved company for the application of that rate, which may be a date earlier than the notice mentioned in that subsection but not earlier than 1 January 2024; and [Act 35 of 2024 wef 01/01/2024] | | (d) | B is the sum of every rate increase specified by the Minister or authorised body to the approved company in accordance with subsection (6). [45/2018; 41/2020] [Act 35 of 2024 wef 01/01/2024] |
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(6) For the purposes of subsection (5)(d) —| (a) | if A in subsection (5)(a), (b) or (c) is 5% or 10%, the Minister or authorised body must specify to an approved company, for the 3rd, 4th, 5th and 7th 5‑year period of its tax relief period, a rate increase of at least 0.5% that applies to the years of assessment of all the basis periods within each of those 5‑year periods; and | | (b) | if A in subsection (5)(b) or (c) is 15%, the Minister or authorised body must specify to an approved company, for the 5th and 7th 5‑year period of its tax relief period, a rate increase of at least 0.5% that applies to the years of assessment of all the basis periods within each of those 5‑year periods. [Act 35 of 2024 wef 01/01/2024] |
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| (6A) The Minister or an authorised body may, on or after 17 February 2024, on the Minister’s or authorised body’s own initiative or on the application of the approved company, by notice to the company substitute the base rate applicable to the approved company under subsection (5)(a) or (b) with 5%, 10% or 15% (as the case may be) for the remaining part of the period in subsection (3). [Act 35 of 2024 wef 01/01/2024] |
(7) Subject to subsection (8), an approved company must elect a qualifying IPR to which subsection (1) is to apply for any year of assessment —| (a) | in the form and manner determined by the Comptroller; and | | (b) | at the time the approved company lodges its return of income for that year of assessment, or by such later time as the Comptroller may allow in any particular case. [45/2018] |
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| (8) An election of any qualifying IPR made under subsection (7) for a year of assessment is irrevocable, and the approved company is treated as making an election for the same qualifying IPR for each subsequent year of assessment. [45/2018] |
| (9) To avoid doubt, subsections (7) and (8) do not prevent an approved company from electing for any year of assessment, any qualifying IPR not already elected or treated as elected under those subsections. [45/2018] |
| (10) The approved company must, in such circumstances as the Comptroller may determine and in such form and manner as the Comptroller may require, provide the Comptroller with such information and documents as the Comptroller may require for the purposes of determining the applicability of subsection (1) in a particular case. [45/2018] |
(11) The Minister may make regulations to provide for any of the following:| (a) | the determination of the percentage of qualifying intellectual property income of an approved company for the purposes of subsection (1); | | (b) | the intellectual property income that is qualifying intellectual property income for this section; | | (c) | the deduction (otherwise than in accordance with this Act), from the qualifying intellectual property income of an approved company, of —| (i) | allowances attributable to the income; and | | (ii) | expenses, losses and donations allowable under this Act, |
| including deduction of these allowances, expenses, losses and donations in such manner and to such extent as the Comptroller may determine; |
| | (d) | the circumstances under which a prescribed amount of qualifying intellectual property income that has been assessed to tax at the concessionary rate in subsection (1) may be deemed as income chargeable to tax at the rate of tax in section 43(1)(a) for a specified year of assessment; | | (da) | the circumstances under which a prescribed amount of expenses, allowances or donations deducted from qualifying intellectual property income of an approved company may be deemed as a loss; | | (db) | the treatment of the loss mentioned in paragraph (da), including disregarding any part of it, or making available any part of it for —| (i) | deduction against any income subject to tax at the rate specified in section 43(1)(a) for a specified year of assessment in accordance with this Act; | | (ii) | deduction against any income for any preceding or subsequent year of assessment in accordance with this Act; and | | (iii) | transfer under section 37B; |
| | (dc) | the application of the provisions of this Act for the purpose of the deductions and transfer in paragraph (db) with such modifications as may be prescribed; | | (e) | the records to be kept by an approved company; | | (f) | generally to give effect to or carry out the purposes of this section. [45/2018; 27/2021] |
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| (12) To avoid doubt, any regulations made under subsection (11)(e) do not affect the generality of section 67. [45/2018] |
(13) In this section —| “qualifying intellectual property income” means any intellectual property income prescribed by the Minister in regulations made under this section; |
| “qualifying intellectual property right” or “qualifying IPR” means any intellectual property right prescribed by the Minister in regulations made under this section. [43ZI [45/2018] |
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