Due Date for Singapore Corporate Tax Filing is 30 November: Know 5 Ways to Manage the Hurdles
The Singapore tax filing date is fast approaching. Just a few days are left to fasten up the process of online tax filing. Filing and paying taxable dues by 30 November is recommended so as to avoid enforcement actions. By this time, many of the entities and SMEs are most likely to complete the jobs involved in the corporate tax filing. Nevertheless, some are still finding hard to tackle with the last minute hurdles. This blog provides a list of all the essential facts, one should keep in mind for a flawless process of tax filing.
Decide Your Actual Tax Rates
IRAS (Inland Revenue Authority of Singapore) has introduced a unique set of benefits and incentives to the business organizations. Get yourself acquainted with them or else you will miss the opportunities awaiting for your business. The headline tax rate for Singapore corporate tax is capped at 17%.
Note that under Partial Tax Exemption Scheme, 75% of up to the first S$10,000, and 50% of up to the next S$290,000 of a company’s chargeable income is exempt from Singapore corporate tax. Remaining chargeable income is taxed at 17%.
In addition to this, a start-up company with an annual chargeable income of S$100,000 is eligible for 100% tax exemption for first 3 consecutive years of assessment. However, they have to meet certain prerequisite conditions. Likewise, there are a few other tax concessions and incentives Singapore has to offer. Depending on the size of chargeable income of your company, you have to decide what is your actual tax rate.
Calculate the Tax on Chargeable Income
You are advised to take measures to avoid paying an excess amount of tax by making adjustments to your net profit. Pay only what is taxable by law. This act is necessary because all profit earned by the company are not taxable while some expenses are not eligible for tax deduction. You can deduct the nontaxable income, such as capital gains, the sale of fixed assets and income of foreign exchange from the net profit list and refrain from adding the expenses that are not tax deductible. This way you can compile an effective tax computation plan which will help you calculate the tax on actual chargeable income
Get All the Paperwork Ready
It is mandatory for every company to file a complete set of returns, including audited/unaudited accounts, Form C, form and tax computation. You need to submit Form C (a declaration form) for the company that shows the annual income of your organization. The tax return is filed on the basis of profit earned for the financial year ending in the preceding year. Lastly, tax computation is a financial statement showing the net taxable amount with the details of net profits and loss.
Do Check for Errors at the Eleventh Hour
Don’t let a silly mistake creep into your income return. It is wise to do a last minute check beforehand. The most common mistake cited on tax returns are wrongful claims of the tax deduction for private expenses and PIC scheme. These mistakes may make you pay a hefty amount in the name of tax penalty. Thus, you can take the help of a professional tax service in order to avoid any errors or mistakes.
Where to Submit Tax Online
You are required to file your corporate tax return via myTaxportal. However, you need to have access to a few things such as Tax Reference Number of your organization, Your SingPass or IRAS PIN and e-service access Code. Upon filing, you will receive a Notice of Assessment (NOA), which is your official tax bill.