Corporate Tax – benchmarked to attract business and multinationals
Singapore is pro-business
Singapore is a leading example of a country that maintains low corporate income tax rates. It also introduces various tax incentives to attract and keep business and multinational global investments.
Singapore has a single-tier based flat-rate corporate income tax system. It has a territorial tax system so only Singapore derived income is taxable. The Corporate tax rate is kept at a competitive level, benchmarked and kept in line with neighbours like Hong Kong. Tax now has been reduced from 20% to just 17%. The effective rate is normally lower than this headline tax rate due to applicable tax exemptions and tax incentives and depreciation concessions.
The effective tax rate is one of the lowest in the world. The general pro-business policy of Singapore is the two important factors contributing to the economic growth and foreign direct investment into the country. This has been the policy for a long time and is unlikely to change – giving any investor confidence and certainty in the Singapore miracle environment.
Tax paid by a company on its chargeable income is the final tax and all dividends paid by a company to its shareholders are also exempt from further taxation.
There is no tax on capital gains in Singapore. Other countries tax capital gains on areas like: sale of fixed assets, property, capital transactions and foreign exchange.
Small business get more concessions
Small Business get further Small business and entrepreneurial business get further taxation concessions to encourage them to move to Singapore. To ease the burden on smaller businesses they are exempted from audit and can file unaudited accounts. An Exempt Private Company (EPC) is defined under Section 4(1) of the Companies Act as a company, which has no more than 20 shareholders, and its shares are held by individuals only and have less than S$5m turnover.
Singapore wants more entrepreneurs and charitable foundations
Small business makes the economy work and grow. Singapore has many grants and incentives to bring entrepreneurs and talent to Singapore.
Singapore also wants more charitable foundations to set up Asian headquarters in Singapore to serve beneficiaries in the Asian region. Charitable giving and volunteering is well established in Singapore community. Singaporeans are generous donation givers and support disaster relief across Asia. Because of Singapore’s low tax rates, donations to registered charities is a tax deduction at twice the donation. There are many opportunities to volunteer in a charity or as a professional volunteer your professional skills, time and even become a Director of a Charity.
Wow, so what is stopping you from moving your business to Singapore and enjoying the superior lifestyle it offers?