As a Singaporean adult or corporate entity, you must know when to file your taxes. This prevents you from falling foul of requirements and being forced to pay penalties or answer a summon for something that could easily have been fulfilled. As a result, this article goes into great detail about when and how individuals and businesses should compute and file their taxes in 2023.
Everything You Need to Know About Personal Tax Filing Deadlines
Those who are tax residents in Singapore are required to pay taxes. You are considered a tax resident if you are a Singaporean citizen who resides in Singapore (even if you travel out occasionally) or a permanent resident who has established a permanent home in Singapore. It also applies to a foreigner who has stayed or worked in Singapore for 183 days or more in the previous year.
In Singapore, the more annual chargeable income a person has, the more he or she is taxed. This means that as chargeable income increases, so does the tax rate. These taxes must also be filed on time. The tax return for 2023 must be filed on a calendar-year basis and submitted by 15 April. If done electronically, the deadline is April 18th.
There are, however, exceptions that allow tax residents to avoid paying taxes. One example is a Singapore Citizen or Permanent Resident who has worked abroad for some time. In this instance, their overseas income does not have to be declared, and their income is not taxable, even if transferred to a bank account in Singapore.
Everything You Need to Know About Corporate Tax Filing Deadlines
Singapore’s corporate tax is payable when due and includes all net income earned by a company during the fiscal year. The country has a one-tier corporate tax system, and the tax paid by a company on its chargeable income is the ultimate tax.
Corporate entities are typically required to pay three types of taxes:
- Estimated Chargeable Income (“ECI”)
- Goods and Services Tax (“GST”) payment
- Corporate Income Tax – Form C/ Form C-S/ Form C-S lite
Filing of Estimated Chargeable Income (ECI)
The Estimated Chargeable Income, or ECI, is a tax obligation that Singapore companies must fulfil. It is calculated using an estimate of the company’s taxable income for the fiscal year. The taxable income mentioned here includes the deduction of several expenses where allowed.
The ECI must be filed by all companies, regardless of the estimate. However, a corporate entity can be exempted from filing an ECI if:
- Its income is zero for the accounting year.
- If the company’s annual revenue is less than $1 million for the fiscal year on or before June.
- If the company’s annual revenue is less than $5 million for the fiscal year on or after July.
- Foreign universities, real estate investment trusts (REITs), designated unit trusts, and similar entities are exempt from filing taxes.
Eligible companies must file their ECI within three months of the end of their fiscal year.
Filing of Goods and Services Tax (GST)
The Goods and Services Tax, or GST, is similar to the value-added tax employed among European countries. These taxes are currently levied at a rate of 7% on most domestic goods and services. Since only certain goods and services are taxed, not all businesses are required to file for the tax. If your business is eligible, you would be required to file for GST every quarter rather than once a year, as with the ECI.
Companies must file for GST four times per year, and there are penalties if these taxes are not filed on time. To assist these businesses in avoiding these consequences, the Inland Revenue Authority of Singapore (IRAS) offers a GIRO plan. This strategy ensures that payments for GST are deducted automatically. If you are using this plan, it is important that you have enough money in your account before the payment deduction date.
Companies that are unable to meet their GST tax obligations may apply for an extension. The reason for seeking an extension, however, must be concrete, and approval for such an extension is at the discretion of IRAS. Also, the requested extension cannot be for longer than two weeks.
Filing of Corporate Income Tax – Form C/ Form C-S/ Form C-S lite
The form C/C-S/C-S Lite is essentially the tax return for a corporate entity. It details the company’s income, and depending on the company type, a Form C, Form C-S, or Form C-S Lite must be submitted to IRAS. For any of them, you must file them on or before November 30th, 2023. Qualifying businesses must complete the form even if they are losing money.
Filing Form C-S
IRAS allows small businesses to simplify their tax filing by completing Form C-S. This form contains roughly half of what is contained in form C, but it still ensures that companies declare their eligibility, details of tax adjustments, and details from their Financial Statements (FS), where applicable.
Companies must ensure that they are incorporated in the country, that their revenue is $5 million or less, and that their income from all sources is taxable at 17% corporate tax when filing Form C-S. Another requirement is that they do not claim carry-back of current-year capital allowances or losses. Form C-S filing deadlines are November 30 for paper submission and December 15 for e-filing submission.
Filing Form C-S Lite
The Form C-S Lite is a corporate tax filing designed for Singapore’s smaller businesses. The qualifications are that the Form C-S criteria are met and that the company has an annual income of $200,000 or less. IRAS introduced this form in 2020, and it is the simplest of the three. Form C-S Lite filing deadlines are November 30 for paper submission and December 15 for e-filing submission.
Filing Form C
Form C should be completed by businesses with income that exceeds the thresholds for Form C-S and Form C-S Lite. Since this form is for large corporations, the requirements are extensive. Companies that fill out Form C are typically required to declare essential tax and financial information, such as tax computation and supporting documents, such as audited or unaudited accounts.
Companies can only file Form C on or before November 30th because there is no option for e-filing.
Singapore Corporate Tax Filing Procedures
The following are the basic steps for filing taxes in Singapore. Normally, this is done on your company’s behalf by a provider, but the steps are the same if you do it yourself.
- The first step is to read through IRAS’s instructions for filing corporate tax. This can be found on the IRAS website and serves as a guide for your tax filing submission.
- The next step is to log in to the MyTax website using your company’s Corppass. You will then be asked to verify your identity via SMS or OneKey Token.
- You can then select ‘Corporate Tax’ from the menu bar. Then you select the tax you want to file.
- After that, you must follow the instructions provided by IRAS to file the tax you selected.
Every company in Singapore is required to file corporate taxes. Penalties apply if this obligation is not met or is not met on time. You should file your personal and corporate taxes on time to avoid the inconvenience of penalties. You can also choose to outsource tax filing to your corporate service provider, lowering the risk of failing to meet these obligations.