An Introduction to GST in Singapore
For the uninitiated, GST may seem complicated, but understanding how GST works can have a significant impact on your company’s profits and expenses.
What is GST?
GST means Goods and Services Tax. For consumers, GST is an integrated tax that is incorporated into the price of goods and services in Singapore. Currently, the GST in Singapore is set at a standard rate of 7%, regardless of the nature of goods or services provided.
For companies, if you are a GST-registered business, it means that you collect GST on behalf of the Inland Revenue Authority of Singapore (“IRAS”) by including GST into the prices of your products and services; and then claim GST credits back on the products or services purchased as business expenses. Non-GST-registered companies will not be able to do so.
In short, the basic principle of GST can be summarised as follows:
In Singapore, GST-registered companies would declare how they have computed their GST through filing their GST returns regularly throughout the year.
Benefits for GST-registered companies announced in the Budget 2015
For new GST-registered companies, this year’s Budget has announced that companies that apply for GST registration on or after 1 July 2015 can look forward to a simplified process when claiming GST incurred up to six months before the date of registration.
Companies can claim GST incurred on the following business expenses:
- - Goods held by the company at the point of GST registration; and
- - Property rental, utilities and services, which are not directly attributable to any supply made by the company before it became GST-registered
Read more about Singapore GST at Singapore Company Incorporation.
