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FAQ’S

What is Taxable Supply?

A Taxable Supply is a supply of goods and services made in Singapore other than an exempt supply and GST is chargeable on this supply at a standard rate of 7%. Zero-rated supplies, which are also taxable supplies, are subject to GST at 0%.

What is an Exempt Supply?

There are 2 broad categories of exempt supply – the sale and lease of residential properties and financial services (the Fourth Schedule of the GST Act). The difference between exempt supplies and zero-rated supplies is the claimability of input tax, which is allowed in the latter but not the former

What is an Out-of-Scope Supply?

An Out-of-Scope Supply is a supply that falls outside the parameters of the umbrella of GST. This applies in several cases, such as when the supply is made outside Singapore, or when the supply is not made by a taxable person, or when the law deems that no supply has been made, etc.

What is Taxable Turnover?

Taxable Turnover” is the total value of all taxable supplies made in Singapore (excluding GST) in the course of furtherance of business, inclusive of all standard-rated and zero-rated supplies but excluding exempt supplies, out-of-scope supplies and the sale of capital assets.

How to determine my liability for registration for GST?

You can determine your liability to register for GST using the prospective or retrospective view:

  1. Retrospective view
    1. If the total value of all taxable supplies made in Singapore, at the end of any quarter* and the three quarters immediately before that, exceed $1million, a person is liable to register for GST within 30 days of the end of that quarter.
  2. Prospective view
    1. If there are reasonable grounds to believe that the total value of taxable supplies made in Singapore in the next 12 months will exceed S$1million, a person is liable to register for GST within 30 days of the end of that quarter.

* Quarter means a period of 3 months ending on the last day of March, June, September or December.

When should I start charging GST and making GST claims?

Commencement of charging of GST should occur with effect from the date of registration of GST. Claims will be from this date forward.

Can I register for GST even if my taxable turnover is below S$1million?

Registration is not necessary if your annual taxable supplies do not exceed S$1 million. However, you can apply for voluntary registration if your annual taxable supplies are below S$1 million or if you have not started making taxable supplies but expect them to exceed S$1 million in the next 12 months.

This is primarily subject to the following conditions:

  1. that you make or intend to make taxable supplies in the course or furtherance of your business.
  2. that you make only out-of-scope supplies.
  3. that you make exempt supplies of financial services that are also international services.

After voluntary registration, you must remain registered for at least 2 years, alongside any other conditions that the Comptroller imposes on your business.

If I am liable to register, can I choose the date that I want to commence registration?

When the liability arises, you are expected to inform the Comptroller within 30 days of the end of that quarter and the Comptroller will register you within the next 30 days from that time.

What is the penalty for the late registration of GST?

If you are late in registering for GST, you will be guilty of an offence and be liable on conviction to a fine up to S$10,000 and to a penalty equal to 10% of the tax due in respect of each year commencing from the date on which you are required to make the notification or to apply for registration.

As a GST-registered person, what are my obligations?

  1. e-File accurate GST returns in a timely manner
    1. You need to e-File your GST returns in a timely manner. You will have prescribed accounting periods of monthly, quarterly or half-yearly basis. GST returns must be e-Filed within one month after the end of each accounting period. If there is no transaction done, you are still required to submit a “NIL” GST return.
    2. You need to submit accurate GST returns. To do so, you need to be familiar with the GST rules relating to your business.
    3. Therefore, you may have to engage the required assistance for GST reporting (e.g. full-time accounting staff, computers) and put in place accounting and record-keeping systems (e.g. buy or make modifications to existing accounting system). You may also need to train your staff to ensure they perform the charging and claiming of GST correctly for your business transactions.
  2. Pay tax in a timely manner
    1. When GST charged on your sales is more than GST incurred on your purchases, you need to pay the difference within one month after the end of each prescribed accounting period.
    2. You will need to account for and pay GST to IRAS even if you receive payment from your customers after the end of the prescribed accounting period.
  3. Keep business and accounting records for 5 years
    1. Types of records to keep include:
      • Tax invoices and receipts issued/ received
      • Credit notes and debit notes
      • Business contracts and agreements
      • Tourist refund claim forms (if any)
      • Import and export documents (e.g. permit, bill of lading, air waybill)
      • Business and accounting records (e.g. general ledgers/ debtors, creditors ledgers, purchase orders, delivery notes, purchase and sales books, cash books, records of daily takings, stock records, bank statements, bank-in slips, relevant business correspondences, GST accounts and financial statements)
      • Other documents supporting GST declaration
  4. Change of price displays and invoices
    1. Any price displays, advertisements, publications or quotations in respect of goods or services made to the public must be inclusive of GST. You are required to reflect your GST registration number on all tax invoices, simplified tax invoices and receipts.
    2. Therefore, you may need to incur cost to re-print your price displays and tax invoices to reflect the changes.
  5. Assist in GST Audit
    1. As a GST-registered business, you are subject to audit. Audits can be via telephone interviews, arranged or surprise visits. In the course of audit, your GST refunds (if any) can be withheld. We can also request your suppliers or customers for confirmation of information furnished. Therefore, you need to consider the cost of time and work required in providing assistance.
  6. Accounting for GST On Business Assets At Point Of De-Registration
    1. In the event that your GST registration is cancelled, you need to account for GST on business assets held on the last day of registration if GST was previously claimed on these purchases. This applies when the total market value of these business assets is more than $10,000.

For more information, please click here.

When can I de-register from GST?

You can apply for de-registration from GST if any of the following occurs:

  1. You have ceased to make taxable supplies;
  2. You expect your taxable turnover for the next 12 months to be $1 million or less;
  3. Your business has ceased;
  4. Your business has been transferred as a whole to another person

However, if you have voluntarily registered for GST, you have to remain GST registered for 2 years unless your business has ceased or has been transferred as a whole to another person.

What are the conditions for claiming input tax?

GST paid on goods and services purchased is considered input tax and this amount can be recovered from IRAS on the making of:

  1. Taxable supplies
  2. Supplies outside of Singapore that would be taxable if they were made within Singapore
  3. Supplies that are disregarded for GST purposes but otherwise would have been taxable supplies

For more information, please click here.

How long should I keep records?

Under the Income Tax Act and the GST Act, you are required to keep your business records for a period of at least five years, for records pertaining to accounting period ending on or after 1 January 2007. Business records for accounting period before 1 January 2007 must be kept for at least 7 years

Examples:

Companies with December financial year-end
YA Records for period To keep up to Remarks
2005 1 Jan 2004 to 31 Dec 2004 31 Dec 2011 Seven years
2008 1 Jan 2007 to 31 Dec 2007 31 Dec 2012 Five years
.
Companies with non-December financial year-end, e.g. 30 Jun
YA Records for period To keep up to Remarks
2005 1 Jul 2004 to 30 Jun 2004 31 Dec 2011 Seven years
2008 1 Jul 2006 to 30 Jun 2007 31 Dec 2012 Five years
.

For more information, please click here.

What are the records to do bookkeeping?

Proper records and bookkeeping must be done in order to ensure that accurate filings to IRAS can be done. Estimates are not allowed. Such documents required are receipts, invoices, vouchers, and other relevant documents issued or received from customers/suppliers.

Why outsource bookkeeping?

A qualified bookkeeping professional can offer many more benefits than the other options available, when it comes to tracking the books at your business. After the business bookkeeping professional takes over the books, you will also likely have much more free time to focus on other urgent matters to enhance efficiency.

Do remember that before hiring a business bookkeeping professional, it will be beneficial to determine the budget available and prioritise which services will be needed.