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Tax System
Corporate Income Tax (CIS) Rate :- The standard rate is 17%.
Tax exemption/rebates :- Singapore also offers a range of tax exemption and rebate schemes:

Partial Tax Exemption

75% of the first $10,000 of chargeable income and 50% of the next $290,000 of chargeable income is tax exempt

Tax exemption for new start-up companies

A newly incorporated company that meets the qualifying conditions can claim for full tax exemption on the first $100,000 of normal chargeable income for each of its first three consecutive Years of Assessment (YAs)

CIT rebate

For YA 2016 to YA 2017, companies will be granted a 50% CIT rebate capped at $20,000 for each YA

Basis :- Singapore taxes on a quasi-territorial basis. Tax is imposed on all income accrued in or derived from Singapore and all foreign income remitted or deemed remitted to Singapore, subject to certain exceptions. Foreign income in the form of foreign dividends, branch profits and service income which is received in Singapore by tax resident companies is exempt from tax subject to satisfaction of certain conditions.

Capital gains and losses :- Singapore does not tax capital gains. Under the current “safe harbour” rules, gains from disposal of ordinary shares (held for at least 24 months, minimum 20% shareholding prior to disposal) are exempt from tax. These safe harbour rules apply to disposals on or before 31 May 2022. Capital losses are not tax deductible.

Losses and capital allowances :-
  • Trade losses may be carried forward indefinitely, subject to substantial shareholding test
  • Unutilised capital allowances may be carried forward indefinitely, subject to both substantial shareholding test and same business test
  • Trade losses and unutilised capital allowances may be carried back for 1 year, subject to a cap of $100,000 and compliance with substantial shareholding test. Unutilised capital allowances carried back are further subject to the same business test.

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