Singapore Tax — 17% CIT, 3-Year Startup Exemption & GST 9%

Singapore's headline corporate income tax (CIT) rate is 17%, applied on chargeable income (taxable profits). Singapore uses a single-tier tax system, meaning dividends paid to shareholders are exempt from further taxation at the shareholder level. The 17% rate has been stable since 2010. Singapore also offers partial tax exemptions and startup tax exemptions that significantly reduce the effective tax rate, especially for new companies in their first three years.

Under the Startup Tax Exemption Scheme (SUTE), qualifying new companies enjoy: 0% tax on the first S$100,000 of chargeable income, and 8.5% on the next S$100,000 — for the first three consecutive years of assessment. To qualify, the company must be incorporated in Singapore, be a tax resident, and have no more than 20 shareholders (at least one individual shareholder holding at least 10%). This can reduce the effective tax rate to under 5% on the first S$200,000 of profit.

No. Singapore does not impose a capital gains tax. Gains from the sale of shares, properties (in certain circumstances), and other capital assets are generally not taxable. This is a key reason why Singapore is used as a holding company jurisdiction. However, if a company's primary business is buying and selling assets (i.e., trading), those profits may be characterised as revenue — not capital — and therefore subject to the 17% CIT.

Singapore taxes income on a territorial basis: only income accrued in or derived from Singapore is taxable. Foreign-sourced income (dividends, branch profits, service income) is generally exempt from Singapore tax when received in Singapore, provided it has been subject to tax in the source country at a rate of at least 15%, and the Singapore tax authority is satisfied the exemption is beneficial. This makes Singapore efficient for regional holding and operating structures.

Goods and Services Tax (GST) registration becomes mandatory when a business's taxable turnover exceeds S$1 million in a 12-month period (retrospective basis) or is expected to exceed S$1 million in the next 12 months (prospective basis). The GST rate is 9% as of 1 January 2024. Voluntary GST registration is available to businesses with lower turnover. Registered businesses collect GST from customers and remit it to IRAS quarterly, but can claim input GST credits on qualifying business purchases.