Income Tax (Approved Institutions of a Public Character) Regulations 2004

No. S 39

Income Tax Act

(Chapter 134)

Income Tax (Approved Institutions of A Public Character) Regulations 2004

In exercise of the powers conferred by section 107(2) of the Income Tax Act, the Minister for Finance hereby makes the following Regulations:

Citation and commencement

1. These Regulations may be cited as the Income Tax (Approved Institutions of a Public Character) Regulations 2004 and shall be deemed to have come into operation on 1st January 2004.

Definitions

2. In these Regulations, unless the context otherwise requires —

“appropriate Central Fund Administrator”, in relation to an approved institution of a public character, means the Central Fund Administrator which approved the institution of a public character;

“approved institution of a public character” means an institution of a public character which is approved under section 37 of the Act by the Minister or a Central Fund Administrator;

“related approved institution of a public character”, in relation to a Central Fund Administrator, means an approved institution of a public character which is approved by that Central Fund Administrator.

Use of tax deductible donations

3.—(1) Subject to this regulation, an approved institution of a public character shall use any donation which qualifies for deduction under section 37 of the Act only to fund any activity carried on by that institution which —

(a)	benefits the community in Singapore as a whole;
(b)	is in line with the objectives of the approved institution of a public character as stated in its governing instrument; and
(c)	in the case of an approved institution of a public character which is approved by a Central Fund Administrator, is in line with the objectives of that Central Fund Administrator.

(2) An approved institution of a public character may invest any donation which —

(a)	qualifies for deduction under section 37 of the Act; and
(b)	is not immediately required for use in accordance with paragraph (1),

in such investments as are permitted by law.

(3) An approved institution of a public character shall not allow the total amount of expenses incurred (directly or otherwise) on any fund-raising appeal organised by the institution within a financial year to exceed 30% of the gross amount of the donations which qualify for deduction under section 37 of the Act received by it in that financial year.

(4) Where an approved institution of a public character has set up any fund established for a specific project, any donation received for the project shall only be used for the purposes of that project.

Issue of tax deduction receipts

4.—(1) This regulation shall apply to any approved institution of a public character which is allowed to issue tax deduction receipts and to any approved institution of a public character which, in its capacity as a Central Fund Administrator, issues any tax deduction receipt in respect of any related approved institution of a public character under regulation 3(5) of the Income Tax (Central Fund Administrators) Regulations 2004 (G.N. No. S 40/2004).

(2) An approved institution of a public character may issue a tax deduction receipt to every donor upon the receipt of a donation which qualifies for deduction under section 37 of the Act.

(3) Any tax deduction receipt issued under paragraph (2) shall —

(a)

incorporate the following statement:

“This donation is tax deductible. For individual donors: This receipt is for your retention. You do not have to claim the deduction in your tax form if you have given your NRIC/FIN number. The deduction will be automatically included in your tax assessment. For other donors: Please retain this receipt for submission to the Comptroller of Income Tax.”;

(b)

where the donation is made in accordance with section 37(6) of the Act, incorporate the additional statement as follows:

“Naming Donation — Single Tax Deduction Only.”;

(c)

state the name of the appropriate Central Fund Administrator, where applicable;

(d)

be serially numbered; and

(e)

be signed by either the treasurer of the approved institution of a public character or by any person to whom such function is delegated by its board of trustees.

(4) Where the donor receives some form of benefit in return for any donation but section 37(6) of the Act does not apply to the donation, an approved institution of a public character shall not issue a tax deduction receipt for the donation.

(5) An approved institution of a public character may use such electronic medium as may be specified by the Comptroller to issue the tax deduction receipts.

(6) The form of the tax deduction receipts issued by an approved institution of a public character which is approved by a Central Fund Administrator shall be approved by that Central Fund Administrator.

(7) Where there is a change in the name of an approved institution of a public character, the approved institution of a public character shall issue every tax deduction receipt under its new name with immediate effect from the date of such change.

(8) An institution of a public character shall not issue any tax deduction receipt after it ceases to be an approved institution of a public character.

Duty to maintain donation records

5.—(1) This regulation shall apply to any approved institution of a public character which is allowed to issue tax deduction receipts and to any approved institution of a public character which, in its capacity as a Central Fund Administrator, issues any tax deduction receipt in respect of any related approved institution of a public character under regulation 3(5) of the Income Tax (Central Fund Administrators) Regulations 2004 (G.N. No. S 40/2004).

(2) An approved institution of a public character shall maintain a record showing the particulars of every donation received which qualifies for deduction under section 37 of the Act which shall include, in respect of every donation —

(a)	the receipt number (in numerical sequence);
(b)	the name of the donor;
(c)	the identification number, or corporate or business registration number, of the donor;
(d)	the date the donation was received;
(e)	the type of donation received;
(f)	the amount or value of the donation received;
(g)	any terms and conditions under which the donation was made; and
(h)	where the donation was made in accordance with section 37(6) of the Act, the relationship between the donor and the recipient of the donation.

(3) An approved institution of a public character shall maintain the record referred to in paragraph (2) for a period of 7 years from the year of assessment relating to the year in which the donation is received.

Duty to maintain accounting records

6.—(1) An approved institution of a public character shall maintain accounting records, which shall in particular contain entries showing —

(a)	all the donations received and disbursed which qualify for deduction under section 37 of the Act;
(b)	details of all the income received and the expenses incurred;
(c)	the extent to which the amount of donations received which qualify for deduction under section 37 of the Act has met the target set by the approved institution of a public character, where applicable; and
(d)	the period during which the amount of donations which qualify for deduction under section 37 of the Act can be raised, where applicable.

(2) Where an approved institution of a public character is a separate fund, the person who administers the fund shall maintain separate accounting records for moneys received for the fund and shall comply with the approval period and the amount of donations approved to be collected, where applicable.

(3) An approved institution of a public character shall maintain the records referred to in paragraph (1) and, where applicable, paragraph (2) for a period of 7 years from the year of assessment to which the accounting entry relates.

Requirements relating to financial statement and audits, etc.

7.—(1) An approved institution of a public character shall disclose in its financial statement the total amount of donations received for the period which qualify for deduction under section 37 of the Act.

(2) An approved institution of a public character shall cause its financial statement to be audited by an auditor who has been approved by the appropriate Central Fund Administrator, in respect of an approved institution of a public character which is approved by a Central Fund Administrator, or the Comptroller, in any other case.

(3) The auditor’s report on the financial statement of an approved institution of a public character, for the purpose of submission to the appropriate Central Fund Administrator or the Comptroller under regulation 8(1), must be unqualified.

(4) An approved institution of a public character may apply for approval of a change in the auditor approved under paragraph (2) to the appropriate Central Fund Administrator or the Comptroller, as the case may be, in such form as may be approved by the Comptroller.

(5) The auditor of an approved institution of a public character shall be changed at least once every 5 years, failing which a qualification shall be made in its financial statement.

(6) An approved institution of a public character shall set out information on its activities and financial accounts in the format specified by the Comptroller —

(a)	on its own website; or
(b)	on the website of the appropriate Central Fund Administrator, where a related approved institution of a public character does not have a website,

unless —

(i)	the appropriate Central Fund Administrator waives the requirement to do so, in the case of an approved institution of a public character which is approved by a Central Fund Administrator; or
(ii)	the Minister or such person as the Minister may appoint waives the requirement to do so, in any other case.

Duty to furnish documents to Central Fund Administrator or Comptroller

8.—(1) An approved institution of a public character shall, within 6 months after the close of each of its financial years, furnish the following documents to the appropriate Central Fund Administrator if it is an approved institution of a public character which is approved by a Central Fund Administrator, or to the Comptroller in any other case:

(a)	its audited financial statements;
(b)	an auditor’s report on the use of donation moneys and whether such use is in accordance with the objectives of the approved institution of a public character;
(c)	an auditor’s report on the financial statement of the approved institution of a public character; and
(d)	the fund-raising and expenditure plans of the approved institution of a public character for its following financial year.

(2) An approved institution of a public character which is not allowed to issue tax deduction receipts under regulation 3(4)(b) of the Income Tax (Central Fund Administrators) Regulations 2004 (G.N. No. S 40/2004) shall furnish to the appropriate Central Fund Administrator an annual return of donations in such form as may be specified by the Comptroller no later than the last day of February of each year.

(3) An approved institution of a public character which is allowed to issue tax deduction receipts shall furnish to the Comptroller —

(a)	an annual return of donations in such form as may be specified by the Comptroller no later than the last day of February of each year; and
(b)	the details of every donation received which qualifies for deduction under section 37 of the Act in such form as may be specified by the Comptroller no later than the last day of January of each year.

Obligations of person who administers approved institution of a public character

9. Where an approved institution of a public character is not a body corporate, the obligations imposed on the approved institution of a public character under these Regulations shall be carried out by the person who administers the approved institution of a public character.

Made this 21st day of January 2004.

LIM SIONG GUAN

Permanent Secretary,
Ministry of Finance,
Singapore.

[MF (R) 32.9.16 V5; AG/LEG/SL/134/2002/14 Vol. 1]

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