Tax Alert 

KPMG's Tax Alert examines and discusses the recent tax developments in Singapore and the implications thereof.
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  • April 2014 - Issue 8 (PDF, 223KB) New
    Changes to Tax Exemption of Employer’s Contributions to Mandatory and Non-Mandatory Overseas Pension Fund or Social Security Scheme
    Recently, the Inland Revenue Authority of Singapore published in its website, changes to the rules for the concessionary tax exemption granted to employees on contributions made by their employers to mandatory and non-mandatory overseas pension fund or social security scheme.

  • April
  • April 2014 - Issue 7 (PDF, 298KB) New
    Navigating the tax maze when venturing abroad
    Given Singapore's small domestic market, expanding overseas is always high on the agenda of local businesses. However, operating in new markets is never easy. Foreign taxes, in particular, are often challenging to comprehend.

    Most countries have more than one type of tax. Besides the usual corporate tax on business profits, there are also indirect taxes such as Goods and Services Tax, customs duties and excise taxes. Throw in other business taxes such as stamp duties and capital gains taxes, and tax issues become mind-boggling. The overseas tax maze is even harder to navigate because of constantly evolving tax legislation.

  • March
  • March 2014 - Issue 6 (PDF, 293KB) New
    Innovation as driver of business capability
    Recent debates in Parliament centred on what has happened to the "innovation" in the Productivity and Innovation Credit scheme. The debates suggested that many businesses were using the incentives to cut business costs rather than undertake more difficult and risky investments in innovation.

    Data from the Inland Revenue Authority of Singapore suggests that only 3 percent of PIC claims related to innovation, whether for the purchase, licensing and registration of intellectual property rights or investments in design or research and development.

  • March 2014 - Issue 5 (PDF, 206KB)
    More needs to be done to leapfrog the competition
    For businesses looking to the Singapore Budget 2014 for government assistance to help them with more value-creation activities, the mention of "quality growth focusing on innovation" seemed like just the very lifeline they were waiting for.

    But do the measures announced go far enough to encourage more value-creation by businesses?

  • February
  • February 2014 - Issue 4 (PDF, 188KB)
    Comptroller of Income Tax v BBO (2014)
    In this case before the Court of Appeal, the Comptroller of Income Tax had appealed against the decision of the High Court which had held that the shares that BBO held in 3 companies were capital assets and thus, the gains arising from the disposal were capital in nature and not subject to tax.

    On appeal, the Court of Appeal affirmed the decision of the High Court and held that on the totality of the evidence, the Core Shares were in fact capital assets and the gains attributable to them were not taxable under the Income Tax Act.

  • February 2014 - Issue 3 (PDF, 144KB)
    Getting ready for the ASEAN single market
    COME 2015, the 10 states of ASEAN will form a common market - the ASEAN Economic Community (AEC). The idea of an ASEAN single market and production base is based on the free flow of goods, services, investment and skilled labour and the freer flow of capital. This is expected to bring about a slew of benefits for participating countries.

    Economically, the AEC is intended to drive growth for the countries involved, making it cheaper and easier to do business in the region and, possibly, globally.

  • February 2014 - Issue 2 (PDF, 139KB)
    Tweak R&D tax break to stay competitive
    In a knowledge-based economy, businesses must continuously innovate to stay ahead and compete on a global level. It is little wonder then that research and development tax incentives are often used to offset the costs of carrying out R&D supporting innovation in the developed countries.

    According to a report by the Organisation for Economic Co-operation and Development, as at 2011, 27 of the 34 member countries support R&D through tax incentive schemes. This is double the number in 1995.

  • January
  • January 2014 - Issue 1 (PDF, 203KB)
    Financial sector tax breaks: less is more
    It is undeniable that Singapore has come a long way in growing its financial sector and positioning it as one of the key financial hubs of the world. It is also undeniable that competition is getting more intense, as the developed economies recover from the economic malaise triggered by the 2009 global financial crisis.

    Singapore's Financial Sector Incentive schemes have certainly played a key role. The city state's position as a key financial hub in the world is no doubt a beneficiary of these long-sighted and business-friendly policies.

  • 2013