GST Registration and Filing
Goods and Services Tax (GST) Filing in Singapore
GST is a tax on local consumption, collected for nearly all taxable supplies of goods and services in Singapore. Value Added Tax (VAT) is the terminology used in many other countries, which is a similar tax structure as that of GST. Since 1st April 1994, Singapore’s taxation system introduce the Goods and Services Tax with an aim to shift the focus from direct taxes to indirect taxes. Singapore has been successful in keeping GST as well as income tax rates low and stable. Therefore, it becomes necessary for business owners to identify when is the time to register for GST before GST department crawl by 7% GST on your standard rated supplies.
Basis of Goods and Services Tax (GST) in Singapore – Taxable Supplies
a. Standard-Rated (7%)
GST-registered businesses must charge GST on all sales of goods and services made in Singapore. All supplies other than Zero-rated, exempt, and out of scope supplies
b. Zero-Rated (0%) – Export of goods & International services under section 21 of GST regulations.
Types of International Services under Section 21(3) of the GST Act
- Advertising sales
- Co-location services
- International services (for computer server equipment)
- International transport (for goods and passengers)
- Lease of hire of transport
- Services performed completely overseas
- Services related to goods for export and goods moving outside Singapore
- Services related to land/building/goods located overseas
- Services supplied to overseas person
- Supplies related to ships or aircraft
- Services related to electronic system
- Services performed on goods stored in a warehouse under Specialised Warehouse Scheme
- Supplies related to air and sea containers
- Telecommunication services
- Trust services
Basis of Goods and Services Tax (GST) in Singapore – Non-taxable Supplies
- Sales and lease of residential properties
- Provision of financial services
- Digital payment tokens
- Local supply of investment precious metal
- Transfer of business as a going concern
- Private transactions, ie. non-business activities performed without payment or return expected
- Third country sales
- Sales made within Free Trade Zone Supply
In Singapore, a fixed 7% GST is levy on the import of all goods and services. GST is collected by suppliers of domestic goods and services who are registered with the Comptroller of GST. When you are importing goods into Singapore by post or courier, you will incur GST as long as the amount hits more than $400. With effect from 1 January 2023, GST registration requirements have been updated to non-digital services and low-valued goods imported via air or post.
GST calculation is based on Cost, Freight and Insurance. When you are importing goods in huge quantities, you must activate your Custom Account and apply for Inter-Bank Giro so that duties, taxes, fees, penalties and other charges will be directly deducted from your bank account.
Is It Beneficial to Register for GST
- Usually the large and established business are GST registered, so it is a signal to customers that you have a decent revenue.
- Business do not suffer from tax because company can claims input tax and get refund every 3 months.
- Extra administrative work in accounting comes with added cost for monthly accounting fee.
- One must know the knowledge to prepare and submit the report when outsourced accounting service is not use.
- Increasing 7% to your selling price may deter customer who are not GST registered.
- GST is a burden to consumer when they are unable to claim input tax from the government.
WHAT SHOULD I DO AFTER REGISTRATION IS APPROVED?
Your company must issue Tax invoice which shows UEN reference number. Tax invoices and records must be properly kept for GST audit even after the financial year end. When you are preparing the invoices, please enter the supplies amount and add the prevailing tax rate which is known as Output Tax.
The GST that you incur on business purchases and expenses is known as input tax. There are many GST rules regulating the ability to claim input tax on your business purchases and expenses. Customers must keep all the original receipts with UEN and full company name mentioned on the invoice.
Frequently Asked Questions
Can I Request For GST Exemption If My Revenue exceeds $1 Million?
Yes. Companies which have met certain conditions have to apply to IRAS.
- IRAS will approve the exemption, if more than 90% of your total taxable supplies are zero-rated and if your input tax is greater than your output tax
- Most financial services, the sale and lease of residential properties, and the importation and local supply of investment precious metal
Is My Company required to register for GST?
Yes. It is compulsory when :
- Revenue is more than S$1 million in the past 12 months – known as the retrospective basis OR
- You can reasonably expect the revenue of your business to exceed S$1 million for the next 12 months – known as the prospective basis. This includes any agreements / contracts that you have signed and expected revenue for you in the next 12 months exceed S$1 million.
What is Voluntary GST Registration?
Companies that did not meet S$1 million in revenue, are not required to register for GST. However, GST registration can be done voluntary.
Checklist before GST Registration
- Do I have taxable supplies?
- Do I have only out-of-scope supplies?
- Do I provide exempt supplies of financial services that are also international services?
What must company director do before GST Registration?
The director must complete the mandatory e-Learning course located in IRAS portal which provides basic knowledge of the GST regime, allowing businesses to correctly identify the GST treatment on commonly encountered scenarios. It also explains the reason and how the filing process of GST should be done on a quarterly basis and provides an overview of taxpayers’ tax obligations. Due to the strict requirement of GST registration and submission, all businesses applying for GST registration should go through the GST course and finished up with the test at the end of the e-learning course.
For voluntary GST registrants, the company director, sole-proprietor, partner, trustee must complete the e-Learning course – “Overview of GST” – and pass the quiz within the course. However, this is not required if:
- The company director has experience in managing other existing GST-registered businesses;
- The person preparing your GST returns is an Accredited Tax Advisers (ATA) or Accredited Tax Practitioners (ATP); or
- The business is applying to be registered under the Overseas Vendor Simplified Pay-only Registration Regime.
Do I need to get a Chartered Accounting Firm to assist me?
It is advisable to consult a professional who provides GST filing in Singapore to determine if GST registration is suitable for your business. You would need to consider the pro and cons carefully as you cannot be de-registered as a GST company easily.
GST comptroller will approve voluntary registration based on case-by case basis. Once GST registration is approved, the company must stay registered for a minimum of 2 years. Company who fails to submit the GST filing in Singapore on a timely basis will be fine and charge according to the regulation.
How Do I Submit GST Filing In Singapore?
- Submit your GST return to IRAS within 1 month after each quarter
- Standard quarterly GST filing period April XX, July XX, October XX and January XX
- Your IRAS Compliant Cloud Accounting Software will auto tabulate the difference between output tax and input tax.
- GST services provided by professional accountant will performed GST reconcilations on every quarter to ensure all your figures balance with your accounts.
- Report both your output tax and input tax in your GST return, Form 5 at https://mytax.iras.gov.sg
- Keep a record of the detailed GST filing submitted for the accountant to perform necessary data-entry to the cloud accounting system.
On-Going GST Audit after GST Registration
By 31 March 2021, the IRAS has conducted 2,858 GST audits cases, and the additional taxes and penalties collected from the IRAS GST audits is $207,896,000. This works out to an average of $73,000 of tax and penalties per IRAS GST audit case.
Reason of high penalties in 2021 : Depending on size of the business, the local administrator usually focus of issusing invoice and payment for bills. The company usually get professional support to outsource accounting services only at the end of the year to prepare tax report. With limited time and knowledge from the administrator, the preparation of GST quarterly submission might sometime omit GST reconcilation due to import and complex GST regulation.
What Is The Type Of GST Services Available?
✓ GST Registration and De-registration
✓ GST Computation & Filing
✓ GST Health Check
✓ GST Appeal
✓ GST Audit SOS
✓ Self-Help Kit “ASK” review
Type Of GST Service Fee?
✓ GST Registration $300.00
✓ GST F5 Reporting and Filing *fr $150.00/quarter
✓ Other GST Matter – To be quoted
EBOS PROVIDE GST SERVICES FOR YOUR BUSINESS
All registered businesses in Singapore will have to file monthly or quarterly and an annual GST return depending on the type of business they are running. All these filings are done online on the IRAS website or MyTax Portal under the “Business Tax Matters”.
Nowadays, the Inland Revenue Authority of Singapore (IRAS) is looking into business tax processes very seriously, which means that they ensure that the GST filings are delivered and collected in time. Hence, it’s important to have qualified employees in your company who can understand the intricacies of GST, GST rates, and their interpretation in different situations.
So, the question boils down to – does your company need assistance with compiling and filing the GST returns online?
At EBOS, GST services are one of the many services we provide to our clients. We take GST filing very seriously. Our services go well beyond filing GST returns as we have staff on standby ready to assist your business at any point in time.
We understand that as a business owner or a manager, you are primarily responsible for ensuring that your company is compliant with the GST. For instance, you will have to go through the tedious exercise of finding and filling up the appropriate forms, inputting them in a correct manner or matching them with the corresponding business events, etc. But if you have a GST team or GST service provider with you, you’ll be able to focus on your core business activities while our team works on the complexities of GST.
Consult us today!