How Difficult Would it be to Self-File Corporate Tax
Singapore’ corporate income tax is a single-tier territorial-based tax charged at the flat rate of 17%. Additional tax benefits make it a business-friendly country. How difficult is it to file corporate tax in Singapore? Well, it is not. The authorities here have taken pains to make it easy for business owners to file corporate tax.
How to Self-File Corporate Tax
For successful corporate tax return filing, you must comply with the Inland Revenue Authority of Singapore (IRAS) requirements. It is a tough task needing mental focus and effort. The task is divided into two subtasks. Unless exempt, you have to file two tax returns for your company.
1#. Estimated Chargeable Income (ECI)
You need to file your company’s ECI to IRAS. It is an estimate of its taxable profits for the Year of Assessment (YA). It is calculated by deducting tax-allowable expenses from its income.
ECI Filing Waiver:
You may get an ECI waiver if you fulfil the following conditions:
- Annual revenue is $5 million or below
- ECI is Nil for the YA
You can self-assess whether or not your company fulfils these conditions. If it does, you do not have to file ECI.
2#. Corporate Tax Return Filing
For your company’s corporate tax return filing, you must fill and submit Form C/C-S/C-S Lite to IRAS. These forms give details about your company’s actual income.
Filing Form C-S
Small businesses in Singapore must fill and submit Form C-S for their corporate tax filing. It is simple and 50% short than Form C. You can submit Form C-S for a business if:
- It is a company incorporated in Singapore
- Earns 5 million or less in revenue
- All of its income is taxable at 17% corporate tax
You should also not be claiming:
- Group relief
- Investment allowance
- Carry-back of capital allowances or losses for current-year
- Foreign tax credits; and
- Tax deducted at the source
At the time of submitting Filing Form C-S, you also need to include the following:
- Declaration of the company’s eligibility
- Info about tax adjustments
- Info from your company’s Financial Statements (FS)
It is not necessary to file the company’s FS and tax computation. However, IRAS may ask you to submit them. So, prepare and keep them handy.
Filing Form C-S Lite
In 2020 Singapore introduced Form C-S Lite. It is the easiest form for corporate tax return filing. There are only six main fields to fill.
To file Form C-S Lite for your company, make sure that it:
- Has $200,000 or less in annual income
- Fulfils conditions for Form C-S
Filing Form C
Fill and submit Form C if you cannot file Form C-S or Form C-S Lite to file corporate tax for your company. Along with it, submit tax computation, audited or unaudited FS, and other relevant statements.
If your company is exempted, you will still file the simplified tax return.
If IRAS expects you to file File Form C-S/C-S (Lite)/C, then you better submit them whether your company is in profit or loss.
Steps for Singapore Corporate Tax Filing
You can follow the steps below to self-file your company’s corporate tax. You start by logging into the MyTax website. It will be an online submission.
Step 1#: Login with CorpPass
Login into the MyTax website by using your CorpPass. The website may verify your identity by sending you a OneKey Token or SMS.
Step 2#: Corporate Tax Filing
Check the menu bar and click on the tab ‘Corporate Tax’. Depending on your filing type, click on ‘File ECI’ or ‘File Form C-S/C.’
Step 3#: Follow Instructions
Follow the ques or instructions displayed to file corporate tax accurately.
Due Dates to File Corporate Tax in Singapore
You must remember that you have two types of tax returns to file. And their due dates are different.
- Due date for ECI Tax Return: You have to file your ECI tax return within 3 months from your company’s financial year-end
- Due Date for Corporate Tax Return Filing: You must file company’s corporate tax return filing before or on 30th November every year. Fill and submit Form C/C-S/C-S Lite
Actions to Take After Corporate Income Tax Filing
After you file a corporate tax return, IRAS officials review it. They will send you a Notice of Assessment (NOA) by 31 May of next year. It gives the corporate tax amount you have to pay to IRAS.
You have one month to pay your company’s corporate tax to IRAS. Do it within the period given to you. Or, IRAS may penalise/fine your company for tax liabilities. Its officials may even summon your company directors and ask for an explanation.
It is assumed that the estimated taxable income you reported will not exactly match that reported in Form C-S/C. However, if there is a significant difference between the two amounts, IRAS officials may want to know more about it. You may have to explain the reasons for such a wide difference.
Preceding Year Basis for Singapore Corporate Tax Filing
Singapore corporate income tax is assessed on a preceding-year basis. In 2023 YA, you file tax returns to IRAS and declare your company’s income in 2022.
- Inform IRAS, if your financial year does not end on 31st December
- You also need to inform IRAS, if your financial year lasts more than 12 months
Yes, you can self-file corporate tax on your own. However, it needs your time, effort and mental energy and can distract you from the core goals. The alternative is to outsource it to a corporate tax services Singapore. Their experts can e-file both corporate tax filing reports for your company. They will free you from the task so that you can focus on growing your company.
Please email us at email@example.com or call us at +65-6536 0036 to learn about our customised tax solutions.