GST or VAT is a common sales tax that governments across the world charge from businesses and individuals. This tax is then used for economic growth and keeping the organizational activities running within a state.
GST not only is beneficial at a state level but registering for GST is also beneficial for businesses. Apart from reducing the tax rate of businesses, consumers also consider GST-registered businesses as reputed and trusted corporations.
So, whether you are a retail store or a big enterprise, GST registration is a must. Here is a complete guide that can help you with the process.
What Is GST?
GST is the abbreviation of Goods and Services Tax and in many countries, it is also referred to as VAT (Value Added Tax). When you buy a product or service from a GST-registered company, you are charged a certain amount as GST. However, the GST you have paid to the service provider is not consumed by them but they act as a tax accumulating entity for the government. At the end of each year, the GST accumulated by the company is paid to the government.
In Singapore, the GST rate is 7% at the moment. However, the rate will increase to 8% at the start of the year 2023 and will further increase to 9% at the start of the year 2024.
Who Is Required To Register For GST?
Well. There are two types of company GST registration Singapore, compulsory and voluntary registration. Both have a different sets of requirements. Let us have a look at the requirements:
Compulsory Registration
For compulsory registration, your company has earned at least $1 million in the past year OR your company is expecting to earn $1 million in the coming year in terms of signed contracts and agreements.
You are required to apply for GST registration as soon as your sales exceed $1 million. The time period is 30 days and failure to do so will result in fines and penalties.
Voluntary Registration
You can apply for GST registration voluntarily even if your yearly turnover is less than $1 million and you are not required to register for GST. however, once you have registered for GST with IRAS you must oblige by all the GST regulations. You must timely file the GST return every quarter and carefully maintain all your records for at least five years. You must comply with the regulations for the stated time period even if your business has ceased or you have de-registered from GST.
You must be thinking why voluntarily register for GST when you don’t need to?
Well, registering for GST gives you a lot of benefits including you can claim back any GST you have paid for setting up your business.
What Is Singapore Company GST Registration Process?
Determine Which Type Of Registration Is Needed
First things, you need to determine which type of registration is suitable for your business. You can choose from compulsory retrospective, prospective, or voluntary GST registration.
Take The E-Learning Course
Next, you are advised to take the e-learning course to get accustomed to the GST rules and regulations, compliance tips, solutions to common problems, and returns process. However, this step is not mandatory unless you are voluntarily registering for GST.
Apply Online
This is the most important step of Singapore company GST registration and you can also hire professional company GST registration services for the step. First, you will have to gather all the required documents such as a Business profile or certificate of incorporation and invoices or contracts to prove your income statement.
If you are registering for the voluntary class, you will have to submit the GIRO form and acknowledgment of completing the e-learning course.
Once you have gathered all the required documents, you can apply online through the myTax Portal on the IRAS website using CorpPass. Remember, you must apply for registration within 30 days of the need arises otherwise you will have to pay a heavy fine.
Get Notification
Lastly, you will receive notification of your GST registration via SMS or e-mail. IRAS normally takes 10 working days for completing your applications. Upon acceptance, you will receive a letter of confirmation along with your GST registration number and effective date of registration.
We hope our guide has been beneficial to you. If you have any more questions or you are looking for professional GST or income tax filing services, feel free to contact us. WZ Wu & Partners is a reputed and trusted accountancy firm in Singapore. We are offering full-suite professional and consultancy services to individuals and businesses in Singapore. Whether you need GST registration services or income tax filing services, WZ Wu & Partners is here to help you. Our experienced and expert professional will not only file your tax returns on time but will also make sure that there are no mistakes.