Goods and services tax (GST) in Singapore is a tax on domestic consumption. The tax is paid when money is spent on goods or services, including imports. In general, goods sold, or services performed in Singapore are taxable. The only exceptions are financial services or the sale or lease of residential properties which are exempt supplies.
In Singapore, GST is currently charged and accounted at a rate of 7% on the value of supply.
You must register for GST in Singapore, if:
- At the end of a quarter if your taxable supplies exceed S$1 million for a quarter and the immediate past 3 quarters. Quarter refers to March, June. September or December; or
- At any time if your taxable supplies are expected to exceed S$1 million for the next 12 months.
If you are required to register for GST in Singapore, you must apply within 30 days of becoming liable.
GST registration for companies with annual turnover below $1 million is not mandatory. A company may however choose to register voluntarily if it makes economic sense for them to do so This really depends on their business scenarios and operations. Some factors to consider include:
- Whether their customers are GST-registered – If their customers are GST-registered, then there is greater reason for a Singapore business to be GST-registered as this will enable their customers to claim the GST incurred.
- Whether their suppliers are GST-registered – If their suppliers are GST-registered, then a Singapore company will be incurring GST on the purchases. If they want to claim the GST-incurred, then they may wish to register.
- Whether they have the resources to fulfill the regular GST filing and record-keeping requirements – Companies need to file their GST returns either monthly or quarterly. They need to ensure that GST invoices are issued to their customers; and to keep proper records of the GST claimed.