Singapore Taxation of Foreign Source Income

Taxation of Foreign Source Income

All foreign incomes which have been earned before 22 January 2009 will be exempted from tax when they are remitted from 22 January 2009 to 21 January 2010.

A Singapore company can enjoy tax exemption from foreign-sourced dividends, branch profits and service income if

1. the specified foreign income has been subjected to tax in the foreign jurisdiction from which the income is received; and
2. the headline tax rate of the foreign jurisdiction from which the specified foreign income is received is at least 15%.

Service income means professional, technical, consultancy or other services rendered in the course of a company’s trade through a fixed place of operation in a foreign country.

To enjoy the tax exemption, the company has to furnish the following information

• Nature and amount of income received;
• Country from which income is received;
• Headline tax rate of foreign country; and
• Amount of foreign tax paid in the country from which income was received.

If the Singapore Company does not meet the criteria for exemption, then your foreign source income is liable for taxation.