Income Tax Act - Singapore Statutes Online

Sources of income

Trading operations carried on partly in Singapore

12.—(1) Where a non-resident person carries on a trade or business of which only part of the operations is carried on in Singapore, the gains or profits of the trade or business shall be deemed to be derived from Singapore to the extent to which such gains or profits are not directly attributable to that part of the operations carried on outside Singapore.

Non-resident shipping and air transport

(2) Where a non-resident person carries on —

(a)	the business of shipowner or charterer; or
(b)	the business of air transport,

and any ship or aircraft owned or chartered by him calls at a port, an aerodrome or an airport in Singapore, his full profits arising from the carriage of passengers, mail, livestock or goods shipped, or loaded into an aircraft, in Singapore shall be deemed to accrue in Singapore.

(2A) Subsection (2) shall not apply to passengers, mail, livestock or goods which are brought to Singapore solely for transhipment, or for transfer from one aircraft to another or from an aircraft to a ship or from a ship to an aircraft.

(2B) In subsections (2) and (2A), “ship” has the same meaning as in section 2(1) of the Merchant Shipping Act (Cap. 179).

[Act 2 of 2016 wef 11/04/2016]

Cable or wireless undertakings

(3) Where a non-resident person carries on in Singapore the business of transmitting messages by cable or by any form of wireless apparatus, his full profits arising from the transmission in Singapore of any such messages, whether originating in Singapore or elsewhere, to places outside Singapore shall be deemed to accrue in Singapore.

Employment exercised in Singapore

(4) The gains or profits from any employment exercised in Singapore shall be deemed to be derived from Singapore whether the gains or profits from such employment are received in Singapore or not.

Employment exercised outside Singapore on behalf of Government

(5) The gains or profits from any employment exercised outside Singapore on behalf of the Government by any individual in the discharge of governmental functions shall be deemed to be derived from Singapore except where such individual is not a citizen or a resident of Singapore.

Interest, etc.

(6) There shall be deemed to be derived from Singapore —

(a)

any interest, commission, fee or any other payment in connection with any loan or indebtedness or with any arrangement, management, guarantee, or service relating to any loan or indebtedness which is —

(i)	borne, directly or indirectly, by a person resident in Singapore or a permanent establishment in Singapore except in respect of any business carried on outside Singapore through a permanent establishment outside Singapore or any immovable property situated outside Singapore; or
(ii)	deductible against any income accruing in or derived from Singapore; or

(b)

any income derived from loans where the funds provided by such loans are brought into or used in Singapore.

[5/77]

(6AA) To avoid doubt, the reference to interest in subsection (6) is, in the case of an arrangement that is a finance lease of any machinery or plant that is treated as sold by the lessor to the lessee pursuant to regulations made under section 10D(1), a reference to the part of any payment by the lessee that is income of the lessor under section 10D(2A).

[Act 45 of 2018 wef 12/11/2018]

(6A) Subsection (6) shall not apply to any payment for —

(a)

any arrangement, management or service relating to any loan or indebtedness, where such arrangement, management or service is performed outside Singapore for or on behalf of a person resident in Singapore or a permanent establishment in Singapore by a non-resident person who —

(i)

in the event the non-resident person is not an individual, is not incorporated, formed or registered in Singapore; and

(ii)

in any event —

(A)	does not by himself or in association with others, carry on a business in Singapore and does not have a permanent establishment in Singapore; or
(B)	carries on a business in Singapore (by himself or in association with others) or has a permanent establishment in Singapore, but the arrangement, management or service is not performed through that business carried on in Singapore or that permanent establishment; and

(b)

any guarantee relating to any loan or indebtedness, where the guarantee is provided for or on behalf of a person resident in Singapore or a permanent establishment in Singapore by a guarantor who is a non-resident person who —

(i)

in the event the non-resident person is not an individual, is not incorporated, formed or registered in Singapore; and

(ii)

in any event —

(A)	does not by himself or in association with others, carry on a business in Singapore and does not have a permanent establishment in Singapore; or
(B)	carries on a business in Singapore (by himself or in association with others) or has a permanent establishment in Singapore, but the giving of the guarantee is not effectively connected with that business carried on in Singapore or that permanent establishment. [27/2009]

Royalties, etc.

(7) There shall be deemed to be derived from Singapore —

(a)	royalty or other payments in one lump sum or otherwise for the use of or the right to use any movable property;
(b)	any payment for the use of or the right to use scientific, technical, industrial or commercial knowledge or information or for the rendering of assistance or service in connection with the application or use of such knowledge or information;
(c)	any payment for the management or assistance in the management of any trade, business or profession; or
(d)	rent or other payments under any agreement or arrangement for the use of any movable property,

which are borne, directly or indirectly, by a person resident in Singapore or a permanent establishment in Singapore (except in respect of any business carried on outside Singapore through a permanent establishment outside Singapore) or which are deductible against any income accruing in or derived from Singapore.

[5/77]

(7AA) Any payment by the lessee to the lessor under a finance lease of any machinery or plant that is not treated as sold by the lessor to the lessee pursuant to regulations made under section 10D(1), is treated as a payment under an agreement or arrangement for the use of movable property under subsection (7)(d).

[Act 45 of 2018 wef 12/11/2018]

(7A) Subsection (7) shall not apply to any payment for —

(a)

the rendering of assistance or service in connection with the application or use of scientific, technical, industrial or commercial knowledge or information, where such rendering of assistance or service is performed outside Singapore for or on behalf of a person resident in Singapore or a permanent establishment in Singapore by a non‑resident person who —

(i)

in the event the non-resident person is not an individual, is not incorporated, formed or registered in Singapore; and

(ii)

in any event —

(A)	does not by himself or in association with others, carry on a business in Singapore and does not have a permanent establishment in Singapore; or
(B)	carries on a business in Singapore (by himself or in association with others) or has a permanent establishment in Singapore, but the rendering of assistance or service is not performed through that business carried on in Singapore or that permanent establishment; [Act 37 of 2014 wef 28/02/2013]

(b)

the management or assistance in the management of any trade, business or profession, where such management or assistance is performed outside Singapore for or on behalf of a person resident in Singapore or a permanent establishment in Singapore by a non-resident person who —

(i)

in the event the non-resident person is not an individual, is not incorporated, formed or registered in Singapore; and

(ii)

in any event —

(A)	does not by himself or in association with others, carry on a business in Singapore and does not have a permanent establishment in Singapore; or
(B)	carries on a business in Singapore (by himself or in association with others) or has a permanent establishment in Singapore, but the management or assistance is not performed through that business carried on in Singapore or that permanent establishment; and [27/2009] [Act 37 of 2014 wef 28/02/2013]

(c)

the use of or the right to use software, information or digitised goods, not being a right to commercially exploit in one form or another the copyright in such software, information or digitised goods such as the right to —

(i)	reproduce, modify or adapt, and distribute the software, information or digitised goods; or
(ii)	prepare a derivative work based on the software, information or digitised goods for distribution. [Act 37 of 2014 wef 28/02/2013]

(7B) In subsection (7A)(c) —

“digitised goods” means text, images or sounds that are transferred through a handphone, fixed‑line phone, cable network, satellite, the Internet or other forms of electronic transmission, but does not include software;

“information” means —

(a)	any information in any newspaper or magazine article or report, including financial and business data (such as foreign exchange, stock and property data), and other proprietary data; and
(b)	any information obtained solely for research purposes. [Act 37 of 2014 wef 28/02/2013]

Commission or other payment of licensed international market agent

(8) There shall be deemed to be derived from Singapore any commission or other payment paid to a licensed international market agent for organising or conducting a casino marketing arrangement with a casino operator in Singapore which is —

(a)	borne, directly or indirectly, by a person resident in Singapore or a permanent establishment in Singapore except in respect of any business carried on outside Singapore through a permanent establishment outside Singapore; or
(b)	deductible against any income accruing in or derived from Singapore. [10/2006; 36/2012]

(9) In this section, “casino marketing arrangement”, “casino operator” and “international market agent” have the same meanings as in the Casino Control Act (Cap. 33A).

[36/2012]

(10) In this section, “finance lease” has the same meaning as in section 10D.

[Act 45 of 2018 wef 12/11/2018]

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