Income Tax (Exemption of Interest and Other Payments for Economic and Technological Development) Notification 2000

No. S 411

Income Tax Act

(Chapter 134)

Income Tax (Exemption of Interest and
Other Payments for Economic and
Technological Development) Notification 2000

In exercise of the powers conferred by section 13(4) of the Income Tax Act, the Minister for Finance hereby makes the following Notification:

Citation and commencement

1. This Notification may be cited as the Income Tax (Exemption of Interest and Other Payments for Economic and Technological Development) Notification 2000 and shall be deemed to have come into operation on 25th February 2000.

Definitions

2. In this Notification —

“financial institution” means an institution licensed or approved by the Monetary Authority of Singapore, and includes an institution approved as an approved Fund Manager under section 43A of the Act and an institution approved as a Finance and Treasury Centre under section 43G of the Act;

“related party”, in relation to a financial institution, means any other person who, directly or indirectly, controls the financial institution, or is controlled, directly or indirectly, by the financial institution, or where the financial institution and that other person are, directly or indirectly, under the control of a common person.

Exemption

3. Subject to paragraph 4, there shall be exempt from tax any payment made under an interest rate or currency swap transaction by a financial institution to a person who is neither a resident of nor a permanent establishment in Singapore.

Terms and conditions of exemption

4. Where the payment made under an interest rate or currency swap transaction by a financial institution is to a related party, the exemption under paragraph 3 shall apply only if the transaction is carried out at arm’s length and the following documents are furnished with the return of income made by the financial institution under section 62 of the Act:

(a)

in relation to any such swap transaction entered into during the basis period relating to the year of assessment for which the return is made, a certificate issued by an external auditor certifying that the swap transaction between the financial institution and the related party is carried out at arm’s length; and

(b)

in respect of each related party to whom interest rate and currency swap payments were made during the basis period relating to the year of assessment for which the return is made, a statement stating —

(i)	the name, place of incorporation and country of residence for tax purpose of the related party;
(ii)	the total amount of swap payments made to the related party during that basis period; and
(iii)	the total amount of swap payments received from the related party during that basis period.

Application of section 33 of Act

5. Nothing in this Notification shall be construed as limiting or in any way affecting the operation of section 33 of the Act.

Amendment of Notifications

6. The Notification (N 3) in respect of Exemption from Tax of Interest, Royalties, etc., on Economic and Technological Development Loans is amended by deleting the item relating to G.N. No. S 22/92.

Made this 12th day of September 2000.

LIM SIONG GUAN

Permanent Secretary,
Ministry of Finance,
Singapore.

[MF R32.12.021 Vol. 4; AG/LEG/SL/134/97/9 Vol. 2]

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