SBS Consulting Announces Alignment of Corporate Services to Accommodate the 2015 Budgetary Changes
“With the change in personal income tax rate and changes in government grants and schemes for local Singapore companies, SBS Consulting has aligned their services to meet the precise statutory regulations of every relevant change in Budget 2015”.
Deputy Prime Minister and Minister of Finance Tharman Shanmugaratnam delivered this year’s Singapore budget in parliament, on 23 Feb 2015. Before delivering the budget, the government promised a people’s budget, and it certainly did to fulfill people’s expectations. Subsidies are enhanced to focus on the future and to accommodate the rising demand for funds, increased taxes are levied on wealthy Singaporeans. Thus, for the first time after about a decade, Singapore witnessed a progressive change in the personal income tax rates.
SBS Consulting, a renowned corporate service provider in Singapore welcomed this budget with great enthusiasm. For years, SBS Consulting has been offering quality incorporation, accounting, taxation, company secretary and a variety of corporate services to its clients. With the change in personal income tax rate and changes in government grants and schemes for local Singapore companies, SBS Consulting has aligned their services to meet the precise statutory regulations of every relevant change in Budget 2015.
“The budget is more future centric, developed with an aim to build a better future for Singapore. Two major outcomes of the 2015 budget are ensuring assurance in retirement by strengthening social support and offering enhanced support for the middle-income families. The way in which our finance minister has advocated five growth clusters is simply remarkable”, said Ms. Meena, the business head of SBS Consulting.
Definitely, the government has succeeded in making the CPF system more progressive and result yielding. However, employers, especially owners of SMEs have mixed feelings. They feel like they are taking one more blow, when they already are suffering from rising business costs. The increased CPF rates for older workers and a proposed change in offering increased CPF salary ceiling is one of the additional burden Singaporean employers will have to face.
“Many of my clients are worried about these changes; however, the Temporary Employment Credit (TEC) Scheme is expected to lessen the burden from the employer’s shoulders for next three years. We at SBS Consulting offer payroll services to many of our clients, Although the changes are applicable from YA 2016, we already have trained and customized our Singapore payroll services to meet the revised changes in CPF system,” said Ms. Meena.
Commenting on the changes in tax rebates, Ms. Meena said, “To celebrate fifty years of independence, the government has announced a tax rebate to share the optimistic economic growth Singapore has achieved in previous years. Although this is an exceptional gesture from Mr. Shanmugaratnam, please understand, the tax rebate of S$1,000 is the lowest since Singapore got its independence. Nevertheless, in one or the other way this one-off tax rebate of 50 percent capped at S$1,000 for the YA 2015, is surely beneficial for Singaporeans representing middle to upper-income groups. Since the proposed tax rebate is for the income year 2014. SBS Consulting has already made provisions for our clients to claim the proposed Tax Rebate through our acclaimed Taxation Services”.
Since YA 2010, the corporate income tax rate in Singapore never crossed the 17% threshold. Being one of the lowest corporate income tax rates in the world this tax rate is merely 0.5% points higher than the Hong Kong corporate income tax rate of 16.5%. Including the PIC scheme and substantive tax-related incentives, the effective tax rate of a corporate entity in Singapore can be further reduced below 16.5%.
Considering the corporate tax rebate announced in the budget 2015 for the YA 2016 and YA 2017, the effective tax rate for the Singaporean companies filing net chargeable income of S$500,000 is actually reduced to 8.27%. This, in fact, is a good decision and a motivational factor for foreigners and locals willing to incorporate a business in Singapore.
“Measures were taken right from 2011 to make our income tax regime more progressive. The Singapore Budget 2011, introduced changes in individual tax rates, and revised more income tax bands for reducing the pressure of paying taxes from the minds of middle-income earners. The announcement to increase the income tax rates for high-income earners with effect from YA 2017 came as a surprise. In fact, it was necessary to reduce the widening gap of income inequality amongst Singaporean employees”, said one of the SBS employees.
The top marginal income tax rate is increased from current 20% to 22% taking effect from YA 2017. This change has widened the gap between top marginal income tax and corporate tax rate by about 5%. This difference is disheartening for self-employed individuals depending on their levels of income. Therefore, it becomes necessary for these individuals to think of incorporating a company in Singapore in lieu of lower corporate income tax and partial tax exemption policies.
“In the past, we have advised and helped many such individuals in incorporating their business. Henceforth, by accommodating revised budgetary changes, we will ensure that we continue to help such aspiring self-employed individuals to become successful entrepreneurs with our visionary incorporation services”, said Ms. Meena in the context of above information.
“SBS Consulting is known for offering out of the box corporate services. Every year we help a number of local and foreign entrepreneurs for incorporating a business in Singapore. The professional incorporation experts at SBS already have revised incorporation plans ready with them. Especially the updates on government offering enhanced support for internationalization, double taxation and increase in M&A Allowance by lowering qualifying threshold has given new dimensions to our exceptional incorporation, taxation, and accounting services in Singapore,” concluded Ms. Meena.
SBS Consulting Pte Ltd is one of the reputed incorporation firms in Singapore. Along with the incorporation, SBS also offers accounting, taxation, company secretarial, payroll, XBRL and GST Filing services. The professionals at SBS Consulting are trained to keep their clients abreast of each development.
Immediately after the budget was declared, SBS Consulting collaborated and designed the incorporation and taxation services with precise tax strategies to offer only the quality services and best results to their clients. SBS has a policy to help their client right from the start, i.e. from incorporating a company in Singapore, identifying the appropriate tax and business incentives, offering accounting, auditing, company and secretary and payroll services. To get in touch with SBS Consulting, you can access the details