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What is Corporate Tax? Benefits of Corporate Tax Service in Singapore

Last modified: June 8, 2023
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What is Corporate Tax? Benefits of Corporate Tax Service in Singapore

If you are wondering, “What is corporate tax rate in Singapore?”, “Is it affordable to small businesses?” then the answer is simple. Yes, it is affordable, and you must pay a flat rate of only 17%. Singapore is one of the best places to incorporate and run a business.

However, corporate income tax filing is a time-consuming and complex process. And, if you do it on your own, because of the urge to be on the right side, you may end up paying a higher than necessary tax amount. It is why companies trust and outsource the task to the corporate tax services Singapore.


What is Corporate Tax in Singapore?

Corporate income tax, or company tax, is a tax that both local and foreign companies must pay. At a flat rate of 17%, it is affordable. What is corporate tax rate for other businesses?

Do sole proprietorships or partnerships in Singapore also pay corporate tax?

No! Their income is considered as that of their owners. Proprietors and partners have to pay personal income tax, ranging from 0%-22%. It is why you must choose your business structure carefully.

The Singaporean taxation system is a territorial-based tax system. Corporate tax in Singapore is a single-tier tax. It means a company can disburse dividends to its shareholders after paying its corporate tax. These are tax-free, as Singapore levies no tax on capital gains.


How Difficult to File Corporate Tax

After knowing “What is corporate tax?” it is natural for you to ask, “How difficult is it to file corporate tax in Singapore?” Well, the World Bank has a high opinion of Singapore’s taxation system. It is well known for low corporate tax rates, short compliance time, and fewer tax payments.

You must hire a provider of corporate tax services Singapore and authorise them to take care of your tax matters. Then they use your Corppass to log in to the IRAS website. They fill and submit Form C-S, Form C-S (Lite), or Form C for your business.

IRAS even allows a longer payment plan if you are experiencing difficulties paying taxes because of financial problems. However, you get such a suitable plan only if you are ready to pay via GIRO.


Benefits of Corporate Tax Service in Singapore

Corporate tax filing is a difficult and complex task for many. It may lead to late payments. Then, the Inland Revenue Authority of Singapore (IRAS) fines and/ or penalises the company. You can avoid it easily and save on tax costs by hiring tax professionals.

Avoid Tax Penalties

Corporate tax services Singapore help you take care of tax compliance. It keeps you on the right side of the tax authorities. These tax experts take care of documentation. It is the key to being spot-on with your tax compliance.

However, documentation is a painstaking, time-wasting task. It can stress out companies that are short-handed. That is why it makes sense to outsource this task to an experienced corporate tax service provider.

These experts assist you in tax filing within the deadline. They ensure to pay your corporate tax within one month from the date of the Notice of Assessment (NOA) sent by IRAS.


Claim Tax Benefits

Singapore government assist small businesses through grants and schemes like Productivity Solutions Grant (PSG, Enterprise Development Grant (EDG), PACT, and Double Tax Deduction for Internationalisation (DTDi).

Professionals at your corporate tax services provider assist you in claiming tax grants, benefits, exemptions, and incentives. They help you reduce your effective tax to the range of 8.5%-9.5%. You pay the minimum tax amount, which is just and legal.

If the assessed tax amount is higher than it should be, they appeal to IRAS on your behalf, and any excess tax amount gets refunded to you.


Data Collection & Preparation

Outsourcing tax preparation activity to your taxation services provider frees up your staff in finance departments. Your staff gets enough to locate the tax data required for tax submissions.

Your provider takes care of data compilation, structuring, and sorting throughout the financial year. This is all heavy compliance-related work.

Their professionals help save your staff’s time and efforts at the end of your financial year when the time at hand is limited. They compile and collate all financial data for the year. They use it to generate reports for annual returns, claim tax benefits and tax filing.

It leaves your staff free to handle essential tasks like preparing a budget or forecast for the coming financial year. You can also ask them for advisory services for information on schemes to improve tax savings.


Tax Compliance

Singapore updates its tax laws regularly to keep them relevant. These tax adjustments may happen as high as eight times a year.

As the owner, you are focused on achieving business goals and objectives. At the same time, your staff from the accounting or finance departments have their financial duties and obligations to chase.

Keeping up with the new tax legislation is challenging for you as a multitasking business owner or your staff. And failing it can compromise your tax compliance.

Corporate tax services Singapore is a specialist in tax services. They have the latest on new Singapore corporate tax directives and can ensure tax compliance. You can rely on them for updated knowledge about tax adjustments.


Data Security

Protecting your company’s financial data from hackers, ransomware, and malware is a must. As a business, you must invest in the latest protection software and systems.

The threat of data breaching is greater for the data in digital format. It increases if you or your staff is accessing it on the go without the protection of a potent security system over an insecure network.

Corporate tax services Singapore are cautious about handling and securing their clients’ tax data. They spend on enterprise-level data protection and security systems to ensure client data is secure.


Data Accuracy

Accuracy and the just treatment of small detail are crucial factors in ensuring corporate tax filing and compliance.

Your small in-house accounting team may be unable to rise to the challenge. Sometimes, it may also fall outside the scope of their experience and knowledge.

Access to a team of tax experts is one of the benefits of a corporate tax service provider. Their experienced and certified tax consultants assist you in avoiding tax omissions, legal actions and penalties.


Focus on Business’ Core Goals & Objectives

The knowledge that an experienced tax expert is taking care of the task helps you relax. It releases your stress or anxiety. More importantly, it frees your time, which you can use to achieve your company’s goals and objectives.

Singapore is a highly competitive marketplace. If you want to stay afloat, you must give your full attention to your business. It needs time and a free mind. You may get them by appointing a provider of corporate tax services Singapore. Well, now you know, in brief, what is corporate tax and the benefits of hiring the right provider for filing it.

Call us at +65-6536 0036 or email us at info@sbsgroup.com.sg to learn about the tax benefits we can claim for you and our customised solutions to your tax problems.

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