The GST or Goods and Services Tax is also referred to as Value Added Tax in some nations (VAT). It is a consumption tax imposed on consumers in Singapore for the provision of goods and services, and it also applies to goods imported into the nation. The selling price of the goods and services offered by businesses that have registered for GST is used to determine the tax rate. On behalf of the government, they act as an agent to collect the tax.
Singapore imposes a 7% tax on imported products known as the Goods and Services Tax (GST).
Because it is collected at each stage of the manufacturing and distribution process, Singapore’s GST is referred to as a multi-stage tax.
Whether a business must register for GST is up to the particular organization. Companies with an annual turnover of SGD 1 Million or more are required to go for the compulsory GST filing Singapore. If a trader is not legally obligated to register themselves but believes it would help their business, they can do it voluntarily.
An Overview Of Singapore GST System
The Items and Services Tax (GST), according to the Singaporean government, is assessed on imported goods.
There are several ways to collect the goods and services tax:
- On products and services provided by Singaporean companies that have registered for GST.
- Regarding imports entering Singapore
- On a few imported services purchased from international vendors
- The price that businesses charge for their goods and services includes the GST rate.
If an applicable business’s annual revenue surpasses $1 million, it must register for GST. Companies must understand the sort of registration they need to register (compulsory or voluntary). Therefore, companies must determine if they need to register or not. Even Singapore-based corporations will not be automatically registered; they must register to comply with the law.
People who have earned more than SGD 1 Million at the end of the year are often required to register under the retrospective perspective. Those who are expected to earn SGD 1 Million or more in the upcoming 12 months must register under the prospective perspective.
Singapore law requires businesses that have registered for GST to collect and remit GST on the goods, services, and other items they sell to the local tax authorities.
Only after applying for GST registration with IRAS and demonstrating compliance with certain requirements and requirements are businesses permitted to charge and collect GST on behalf of the government.
Should You Become A GST-Registered Business In Singapore?
Company GST registration Singapore system falls into 2 categories:
- Compulsory Registration
- Voluntary Registration
Compulsory Registration
Registration for GST is required when –
- Your company’s annual revenue exceeded S$1 million; this is referred to as a retroactive basis.
- The prospective basis is the expectation that your company will generate S$1 million over the following 12 months at the time of the transaction. This also covers any contracts or agreements you could sign if you anticipate having more than S$1 million in sales over the following 12 months.
You must register for GST within 30 days of any time your company’s income surpasses S$1 million. Singapore’s tax officials will fine you if you don’t do it by the deadline. To prevent enterprises from manipulating their income to keep it below S$1 million and so avoid registering, there is also an anti-avoidance system in place.
Voluntary Registration
Even if you are exempt from being required to register, you can still choose to do so freely while bearing in mind how your firm does business. Your business should have sales in Singapore either planned for or currently underway (on taxable supplies). You should keep in mind that there are extra requirements if you decide to voluntarily register for GST.
Even if you have deregistered from GST or stopped doing business, you are still required to comply with the GST requirements, retain all of your records for at least five years, and file the GST return every quarter if you registered voluntarily.
GST Filing In Singapore
The implementation of the tax is rather straightforward; you must either absorb the cost by marking the price as GST-inclusive or add GST to your selling price. All prices that are displayed, marketed, published, and quoted orally or in writing must include the GST. If you don’t, it’ll be illegal and you’ll have to pay a fine.
It’s crucial to acquire the correct help if you need assistance with the GST registration of a Singapore company. In addition to assisting you in navigating the difficulties of GST filing, GST registration, and de-registration as well as resolving any disputes and/or issues with IRAS, WZ WU & Partners is an expert in tackling the challenges of Singapore corporate GST registration.
WZ WU & Partners is aware of the significance of handling Singapore company GST registration properly. The consequences of improper registration and subsequent filing will result in serious issues for you down the road. You need to know where to start to make a change for the better if you want to prevent that problem.
Either monthly or quarterly electronic returns must be filed with the tax authorities. The total value of your domestic sales, exports, and purchases from GST-registered businesses, as well as the tax that was paid and the amount that was claimed for a certain period, must all be included in your return.
