FAQ on Goods and Services Tax (GST)
What is GST?
Goods and Services Tax (GST) is a tax charged on the supply of goods and services made in Singapore and on the importation of goods into Singapore.
The current rate is 7%.
What Goods and Services are subjected to GST?
All goods and services are taxable and known as taxable supplies.
However, some items are specifically exempt from GST by law. Exempted items include financial services and the sale or lease of residential properties.
When is it Compulsory To Register?
Your business must be registered to collect GST if your annual turnover exceeds or is likely to exceed 1 million from sale of taxable goods and services.
You can apply for exemption from GST registration if most of your goods or services are exported or supplied internationally (“zero-rated supplies”).
Can I choose To Register?
You may also apply to the Comptroller of GST to collect GST voluntarily. Approval for voluntary registration is at the discretion of the Comptroller.
Once approval is given, you must remain registered for at least 2 years.
Why Should I Register?
Most businesses register for GST to claim back the GST incurred on their business purchases.
When GST paid exceeds GST collected, the difference can be claimed from IRAS as a GST refund.
When GST collected exceeds GST paid, you have to pay the difference to IRAS.
When GST rate increase, it may make business sense to voluntarily register to collect GST in order to claim back GST incurred on business purchases.
Who can Register?
Limited Liability Partnerships
Clubs, Associations, Management Corporations or Organizations
How Do I file GST returns?
The standard procedure is to file GST returns every 3 months (quarterly). You may request for monthly or half-yearly filing instead, however, this is subject to the Comptroller’s approval.
You need to file your GST returns online.
You should always file your GST returns on time to avoid penalty fees.
Are There Any GST Schemes To Help Businesses?
To create a pro-enterprise environment, the Government has several assistance schemes relating to GST. These schemes generally help to ease the cash flow for businesses.
Goods and Services Tax (GST) Assistance Scheme
Get a grant to lower the costs involved in becoming a GST-registered trader. GST traders can collect GST and claim back for GST paid to suppliers.
Major Exporter Scheme (MES)
Major exporters can improve their cash flow by deferring GST payments on goods imported mainly for re-export out of Singapore.
Licensed Warehouse Scheme
Transform your warehouse into a licensed warehouse for storing dutiable goods. In licensed warehouses, duty and Goods and Services Tax (GST) are suspended until the goods are released for sale into Singapore.
Zero GST Warehouse Scheme (ZGS)
Businesses can transform their warehouses into zero-GST warehouses to minimise red tape and bypass the Goods and Services Tax (GST) process.
You can cancel your registration when your business stops or when your business is sold as a whole to another person or when your sales figures do not exceed 1 million SGD. You must submit an application form, along with other revelant documents to the tax authority within 30 days from the date of cessation.
If you make only zero-rated supplies you can apply for an exemption from registration, even if your taxable turnover exceeds the registration limits. This allows you to escape from the administrative requirement of GST registration, as you would only be reclaiming and not paying tax to the IRAS, since the cost to you is the input tax. IRAS will approve the exemption, if more than 90% of your total supplies are zero-rated and if your input tax is greater than your output tax.