Income Tax (Concessionary Rate of Tax for Approved Trustee Companies) Regulations

Income Tax Act

(Chapter 134, Section 43J)

Rg 21

REVISED EDITION 1993

(18th December 1992)

[18th December 1992]

Citation

1. These Regulations may be cited as the Income Tax (Concessionary Rate of Tax for Approved Trustee Companies) Regulations and shall have effect for the year of assessment 1992 and subsequent years of assessment.

Definitions

2. In these Regulations —

“approved trustee company” means a trustee company which is approved by the Minister or such person as he may appoint under section 43J of the Act;

“foreign bond or loan stock issues” means any bond or loan stock issued by a person not resident in Singapore (but excluding its permanent establishment in Singapore) or by a permanent establishment outside Singapore of a person resident in Singapore in respect of any business carried on outside Singapore through that permanent establishment, where —

(a)	the bond or loan stock is denominated in currencies other than Singapore dollars;
(b)	the proceeds of the bond or loan stock issue are to be used outside Singapore; and
(c)	the expenses incurred in respect of the bond or loan stock issue are not borne, directly or indirectly, by a person resident in Singapore or a permanent establishment in Singapore;

“unit trust” means any trust established for the purpose, or having the effect, of providing facilities for the participation by persons as beneficiaries under a trust, in profits or income arising from the acquisition, holding, management or disposal of securities or any other property.

Concessionary rate of tax

3. Tax shall be payable at the rate of 10% on the income derived by an approved trustee company from the provision of —

(a)

any trustee or custodian services arising from a trust by deed where both the settlor and beneficiaries of the trust are —

(i)

in the case of individuals, neither citizens of Singapore nor resident in Singapore; and

(ii)

in the case of companies, neither incorporated nor resident in Singapore and where such a company has not more than 50 shareholders, the whole of its issued capital is beneficially owned, directly or indirectly, by persons who are neither citizens of Singapore nor resident in Singapore; and where such a company has more than 50 shareholders, not less than 95% of its issued capital is beneficially owned, directly or indirectly, by persons who are neither citizens of Singapore nor resident in Singapore;

(b)

any trustee or custodian services for or on behalf of any unit trust which falls within paragraph (c) in the definition of “foreign investor” in the Income Tax (Income from Funds Managed for Foreign Investors) Regulations and where the funds of the unit trust are invested in designated investments within the meaning of those Regulations;

[Rg. 8.]

(c)

trustee or custodian services in respect of foreign bond or loan stock issues including services for monitoring loan covenants and administering loan repayments; and

(d)

custodian services in respect of stocks and shares, denominated in currencies other than Singapore dollars, of companies which are neither incorporated nor resident in Singapore.

Determination of income chargeable to tax

4. For the purpose of regulation 3, the Comptroller shall determine —

(a)	the income chargeable to tax of an approved trustee company having regard to such expenses, capital allowances and donations allowable under the Act as are, in his opinion, to be deducted in ascertaining such income; and
(b)	the manner and extent to which any losses arising from the trustee or custodian services specified in that regulation may be deducted under section 37 of the Act in ascertaining the chargeable income of an approved trustee company.

Application

5. Regulation 3 shall not apply to any payment to an approved trustee company for the services referred to in that regulation which is borne, directly or indirectly, by a person resident in Singapore or a permanent establishment in Singapore.

[G.N. No. S 512/92]

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