Singapore's Corporate Tax Rate & System Explained

Singapore has a competitive corporate tax system known for its low rates, simplicity, and stability. In this article we provide an overview of Singapore's corporate tax rate and its tax system in addition to how it the advantages these offer to companies incorporating in Singapore.

Corporate Tax Rate

Singapore's corporate tax rate is 17%, one of the lowest corporate tax rates in the world. Applied to the taxable income of companies and businesses, it is calculated based on the profit or loss of the company for a given year.

The corporate tax rate in Singapore is a flat rate, which means that it applies to all companies and businesses, regardless of their size, industry, or location. There are no progressive tax rates or tax brackets in Singapore.

In addition to the corporate tax rate, companies in Singapore may also be subject to other taxes, such as:

  • Withholding tax: A tax on certain payments made by companies to non-residents. For example, dividends, royalties, and interest payments.
  • Goods and Services Tax (GST): A value-added tax on the supply of goods and services in Singapore, at a rate of 7%.
  • Property tax: A tax on the ownership and use of property in Singapore, based on the annual value of the property.
  • Stamp duty: A tax on certain documents and transactions, such as the sale of property and shares.

Corporate Tax System

Singapore's corporate tax system is characterized by its simplicity, transparency, and predictability. Important features of Singapore’s tax system include:

  • Laws and regulations: The corporate tax system in Singapore is governed by the Income Tax Act and related regulations and guidelines. These provide the rules and requirements for companies and businesses to calculate and pay their taxes.
  • Filing and payment requirements: Companies in Singapore are required to file their tax returns and pay their taxes by the specified due date. This is usually within three months of the end of the financial year. Companies can file their returns and make payments electronically, using the e-Filing and e-Payment systems of the Inland Revenue Authority of Singapore (IRAS).
  • Assessments and appeals: The IRAS is responsible for assessing the tax returns and payments of companies in Singapore and issuing tax notices or assessments as needed. Companies have the right to appeal their tax assessments if they disagree with the IRAS's decision or calculations.

Advantages of Singapore’s Tax System

  • Low rate: 17% is one of the lowest corporate tax rates in the world and it is lower than the average corporate tax rate of 22.5% in the OECD countries.
  • Flat rate: Singapore's corporate tax rate applies equally to all companies. It does not discriminate based on size, industry, or location.
  • Simplicity and transparency: Simple, transparent, and easy to understand, Singapore’s corporate tax system has clear laws and guidelines and efficient filing and payment systems.
  • Stability and predictability: Over the years, Singapore's corporate tax system has had minimal changes and disruptions and a strong commitment to international tax standards and cooperation.

Final Thoughts

Corporate tax rates just one aspect of a tax system. Before incorporating in Singapore companies should consider other factors, such as personal tax, consumption tax, social security contributions, and exchange rates. Infrastructure, availability of skilled labor, market access, and quality of life are also important factors to take into consideration when choosing a location for a business.

Singapore's competitive corporate tax rate and stable system offer a favorable environment for companies and businesses to operate and grow. A low corporate tax rate, a flat rate across industries, a simple and transparent system, and a stable and predictable environment make it an ideal location for multinational corporations, start-ups, and small and medium enterprises (SMEs).

Nicky Minh

CTO and co-founder

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Explained: Double Taxation Between Singapore & Malaysia

Singapore and Malaysia are neighboring countries in Southeast Asia with close economic, cultural, and social ties. To avoid double taxation and to promote cross-border trade and investment, Singapore and Malaysia signed a Double Taxation Agreement (DTA) in October of 2004. As a business operating in Singapore, here’s what you need to know about the DTA:

The DTA Between Singapore and Malaysia

A Double Taxation Agreement (DTA) is an international treaty signed between two or more countries to avoid double taxation. Double taxation occurs when the same income or profits are taxed by two or more countries, resulting in a higher tax burden for the taxpayer.

The DTA between Singapore and Malaysia is a bilateral treaty signed between the two countries to avoid double taxation and to prevent fiscal evasion. The DTA covers various types of income and profits including: business profits, dividends, interest, royalties, and capital gains.

The DTA between Singapore and Malaysia:

  • Sets out rules and provisions regarding the allocation of tax jurisdictions
  • Delineates what tax relief is available between the two countries
  • Aids in resolving tax disputes
  • Inhibits double taxation.
  • Specifies the tax rates and exemptions for each type of income or profit.
  • Provides for the exchange of information between the tax authorities of Singapore and tax authorities of Malaysia, allowing them to enforce the DTA and prevent tax evasion.

Benefits of the DTA

The DTA between Singapore and Malaysia provides several benefits to taxpayers and businesses in both countries. Some benefits of the DTA are:

  • Reduced tax burden: Taxpayers and businesses based in Singapore and Malaysia can claim tax credits or exemptions for taxes paid in the other country, reducing their overall tax burden.
  • Enhanced cross-border trade and investment: Eliminating double taxation and providing a stable and predictable tax environment encourages cross-border trade and investment between Singapore and Malaysia.
  • Improved tax compliance: The DTA promotes compliance by reducing both tax barriers and incentives for tax evasion. Providing channels for the exchange of information between tax authorities of both nations also helps reduce evasion.

How to Claim Tax Relief Under the DTA Between Singapore and Malaysia

To claim tax relief under the DTA between Singapore and Malaysia, you first need to meet the eligibility criteria and requirements set out in the DTA. Here's how:

  • Determine your tax residence: Your tax residence needs to be in Singapore or Malaysia. This will be based on your domicile, permanent home, or center of vital interests.
  • Identify the type of income or profit: Types of income and profit covered by the DTA include business profits, dividends, interest, royalties, and capital gains.
  • Calculate your tax liability: Your tax liability in Singapore or Malaysia will be based on the tax rates and exemptions specified in the DTA.
  • Prepare the necessary documents: These may include tax returns, tax assessment notices, and other evidence that can be used to support your claim for tax relief.
  • Submit your claim for tax relief: You need to submit your claim to the tax authorities of Singapore or Malaysia. This can be done either through the self-assessment system or by filing a tax return.

The DTA between Singapore and Malaysia avoids double taxation and promotes cross-border trade and investment between the two countries. It covers various types of income and profits and helps tax authorities in both countries better work together and exchange information. Businesses with operations in both Singapore and Malaysia directly benefit from this agreement.

Nicky Minh

CTO and co-founder

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A Guide to Selling on Amazon Singapore

Amazon is the world's largest e-commerce platform, offering a wide range of products and services to consumers and businesses. If you're thinking of becoming a seller on Amazon Singapore, here is a guide to help make your products stand out.

Step 1: Choose Your Niche and Product

Before you can sell on Amazon you need to a product to sell, and you need to understand the niche that it will fill. Begin by identifying the market demand for your product and researching its competition. Determine how your product can fulfill your business goals and vision. The following steps can help you develop your product and find its niche:

  • Research: Analyze the relevant market trends, consumer needs, and industry insights
  • Identify the opportunity gap: Determine how your product adds value to the market
  • Evaluate the competition: Differentiate and position your product within the larger market
  • Define your target audience: Compose a list of key traits that describe the customer profile for your product highlighting their preferences and behaviors.
  • Develop your marketing strategy: Determine the pricing for your product, establish your brand, and lay out the methods you will use to promote it. Remember to align your brand and marketing with your business goals and your vision.

Finally, in order to sell on Amazon Singapore you need to verify that your product is not one of the products prohibited by Amazon, and whether your product requires special permissions.

Step 2: Set Up Your Amazon Account

To sell Amazon Singapore you will need to create a seller account. Here's how to do it:

  • On the Amazon website click on the "Your Seller Account" option that appears under the sign in ‘Accounts & Lists’ drop-down menu item.
  • Decide whether to sell locally in Singapore or globally. After choosing one of these two options, follow the prompts to create your seller account. Seller accounts require personal and business information, such as your name, contact details, and payment methods.
  • Agree to the Amazon terms and conditions and pay the seller fees.
  • Following the registration process, you will receive a confirmation email with your login details.

Step 3: Set Up Your Product Listings

To sell your products on Amazon Singapore, you need to create product listings for each of your products. A product listing is a page on Amazon that provides the product details, images, and customer reviews to the shoppers. To create product listings on Amazon:

  • Log in to your seller account and click on the "Inventory" tab.
  • Click on the "Add a Product" button and follow the prompts to create your product listing.
  • Provide product details including: title, description, images, category, and price.
  • Specify product attributes, such as the size, color, and model, and the stock availability.
  • Set up product options. These include shipping method, delivery time, and return policy.
  • Amazon listing tools, such as the product bulk upload tool, can be used to add multiple products and listings at once.

Step 4: Promote Your Products and Store

To increase your sales and visibility on Amazon Singapore, you need to promote your products and store. Ways for doing so include:

  • Use high-quality and attractive images: Showcase your products to make them stand out.
  • Use keywords and tags: Including keywords in product titles and descriptions improves your search ranking and visibility.
  • Be competitive: Offer competitive prices and discounts to attract buyers and stand out from the competition.
  • Offer excellent customer service and support: fast and reliable shipping, returns and exchanges, and open communication with your customers increases your chance of repeat customers and better customer ratings.
  • Use Amazon marketing tools: Amazon’s Sponsored Products, Amazon Advertising, and Amazon Influencer Program, can all help you reach a wider audience and increase your sales.

Step 5: Monitor and Analyze Your Sales and Performance

Once you start making sales on Amazon Singapore, you will want to monitor and analyze the data and metrics associated with these sales. Amazon provides a variety of tools and reports to help you understand your sales performance; using them can help you to identify opportunities and challenges. These tools are found under the “Reports” tab of your seller account. Here are some of the features they provide:

  • Reports covering time periods of a single day, a week, a month, or a year
  • Filters available for products, categories, or customers
  • Easily accessible order details. These include order numbers, dates, quantities, prices, and payment statuses.
  • Reports on sales trends, customer insights, and conversion rates are all available with Amazon’s analytics tools. Use these to make informed decisions about how to proceed when selling on Amazon.
  • Feedback and review tools, like seller feedback and product reviews, provide a clear understanding of customer satisfaction and experiences. These can give you direct insight into how your customers feel about your products and ways to improve.

Final Thoughts

Amazon Singapore is a popular and lucrative e-commerce platform, offering a wide range of products and services to consumers and businesses. To successfully sell on Amazon Singapore you need to choose your niche, develop your product and set it up on Amazon so that your products’ pages are attractive and contain relative key words. Keeping track of the sales performance on Amazon over time will let you adapt to the demands of your target audience, and help increase sales for your e-commerce business on a platform that reaches a wide audience.

Nicky Minh

CTO and co-founder

2023 GST Rate Increase: Preparing Your Business

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2023 GST Rate Increase: Preparing Your Business

The Goods and Services Tax (GST) is a broad-based tax that is applied to most goods and services in Singapore. Beginning in 2024, the government of Singapore will increase the GST rate from its current rate of 8% to 9%; the revenue generated from this increase is slated to be used on infrastructure and social services.

This increase will have an impact on businesses of all sizes, so it's important to start planning and preparing for the change now.

Expected Impacts of the GST Rate Increase

The government has stated that the GST rate increase will not affect essential goods and services such as healthcare and education. It will, however, apply to most other goods and services including food, clothing, and transportation. The GST rate increase will also affect imported goods, potentially leading to higher prices for imported goods and directly impacting those businesses that rely on imports.

Consumers can expect general price increases across the board for goods and services. Increased costs at the consumer level may lead to reduced demand for some products and services, leading to a loss of sales for businesses.

Businesses can also expect higher costs from the GST rate increase as purchases made from suppliers and vendors will also be impacted by this increase. Businesses registered for the GST will have the added burden of charging their customers the new higher rate, which could lead to some pushback or negative reactions.

To minimize the potential negative impacts of this increased rate, you should begin preparing your company for the necessary increases this increase will have on its operations and finances. This may involve reviewing pricing, sourcing, and other cost-saving measures to ensure the business remains competitive and profitable.

Preparing for the GST Rate Increase:

  • Review your pricing strategy: The GST rate increase will likely result in higher prices for goods and services in Singapore. Consider whether you should absorb the additional cost of the GST rate increase or pass it on to your customers. Whether your customers are also registered as GST businesses will most likely impact this decision, so communicating with them is recommended. Keep in mind that if you decide to pass on the cost to your customers, it is crucial to communicate this clearly and transparently to maintain customer trust and loyalty.
  • Update your systems: The GST rate hike will require you to update your accounting and billing systems to reflect the new rate. Make sure to budget for any necessary updates and allocate resources to implement them in a timely manner. Make sure your systems are up-to-date and accurate to avoid any mistakes or errors, correcting such errors later would be more expensive than the extra cost of preventing them in the first place.
  • Communicate with your customers: Keep your customers informed about the GST rate hike and how it will affect your business. Consider issuing a press release or sending out a newsletter to let them know about the changes. This will ensure that your customers are aware of the impact it will have on your business and that they can make informed decisions about their purchases.
  • Review your contracts: The GST rate hike may have an impact on your existing contracts with suppliers and customers. Review your contracts to determine this is the case. If you have long-term contracts in place, it may be necessary to renegotiate terms to ensure that both parties are protected from changes caused by the GST rate hike.
  • Seek professional advice: If you have any concerns about how the GST rate hike will affect your business, seek the advice of a professional accountant or tax consultant. Professional services can provide valuable guidance and recommendations to help you prepare for the GST rate increase. A professional can also help you to identify any potential tax savings or opportunities that may arise as a result of the GST rate hike.
  • Assess the impact on your business: This may involve conducting a thorough review of your operations, including your pricing strategy, contracts, and systems. By understanding the full impact of the GST rate hike, you can take steps to mitigate any negative effects and position your business for success.
  • Plan for the future: It is important to look beyond the immediate effects of the GST rate hike. This may involve identifying new growth opportunities, diversifying your revenue streams, or implementing cost-saving measures. Thinking ahead will ensure that your business is well-positioned to navigate the changes and thrive in the new economic environment.

In addition to taking the steps outlined above, you should also keep in mind areas that will need your ongoing attention during the early part of 2024. Key areas that deserve focus following the increase include:

  • Managing costs: Identify ways to reduce costs and improve efficiency. This may involve streamlining your operations, negotiating better terms with suppliers, or investing in technology that helps to automate processes. By finding ways to control costs, you can help to offset the impact of the GST rate hike and maintain your competitive edge.
  • Monitoring cash flow: The GST rate hike may affect your company's cash flow, for example, by necessitating changes to your pricing strategy or impacting the nature of existing contracts. Monitor your cash flow closely and make sure that your business has sufficient liquidity to meet its financial obligations. This may involve reviewing your financing options, for example, implementing invoice financing, taking out a business loan, or finding ways to improve your cash conversion cycle.
  • Staying up-to-date with GST developments: Stay informed about all new GST developments so that your business is prepared for any new changes. Being ready for the next GST rate hike will allow you to position your business for long-term success.

The increase to the GST rate in Singapore will be a significant change that will impact businesses of all sizes. By taking the necessary steps to prepare, and keeping in mind potential long-term effects of the hike, you can minimize any negative effects. While the GST rate hike may present some challenges, it is also a chance for businesses to review their operations and identify areas for improvement. By adopting a proactive approach, you can turn the GST rate hike into a positive opportunity for their business.

Nicky Minh

CTO and co-founder

Using Gross Profit Margin to Grow Your Business

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vc e-commerce trends in 2023

Using Gross Profit Margin to Grow Your Business

Gross profit margin is a financial metric used to measure the profitability of a business. It is calculated based on a company’s cost of goods sold (COGS) and revenue. Other expenses such as operating expenses, taxes, and interest, are excluded when calculating it. Gross profit margin is important for businesses to track because it helps to identify opportunities for increasing efficiency and for reducing costs. Below we discuss how to calculate it and how you can use it to make better decisions about your business operations.

Calculating gross profit margin

To calculate gross profit margin, you need to know your business’s total revenue and COGS. Total revenue is all money generated from your business’s sales of goods or services. COGS is the sum of all costs directly incurred when producing and selling those goods or services. For example, the cost of raw materials and the cost of labor. Performing this calculation is simple: subtract your COGS from total revenue,divide the result by your total revenue, multiply by 100. The resulting number is expressed as a percentage.

As an example, suppose a business has total revenue of $100,000 and COGS of $60,000. After applying the following calculation, we arrive at a forty percent:

100,000 - 60,000 = 40,000
40,000 / 100,000 = 0.4
4 x 100 = 40

This can be a useful metric for businesses to track because it provides a snapshot of how well a company generates profit from its operations. Comparing your gross profit margin to industry benchmarks, or to your own performance over time, will help you to see areas where you can improve efficiency and increase profits.

Using gross profit margin to make better business decisions

  • Identify ways to reduce costs: A low gross profit margin is a sign that your business should look for ways to reduce COGS. Consider negotiating better prices for materials, streamlining production process, or finding more efficient ways to use labor.
  • Track your business’s performance: Keep track of your gross profit over time and compare it to industry benchmarks. Doing this allows you to identify trends and patterns regarding profit, and to make adjustments to your operations as needed. If your figures are consistently lower than the industry average, consider changing your pricing strategy, expanding your product line, or finding new ways to differentiate yourself from your competitors.
  • Make strategic decisions about operations: When considering whether to expand into a new market or launch a new product, consider the potential impact on your gross profit margin. This will allow you to make informed decisions about the potential profitability of these initiatives and how to allocate your resources accordingly.
  • Analyze the financial performance of your competitors: Comparing the gross profit margins of different businesses within your industry will provide a sense of which companies are the most efficient and profitable. Use this information to inform your own strategic decisions.

Keeping track of your gross profit margin can help you to understand the profitability of your operations, to identify ways to improve efficiency, and to make better decisions about future growth. Tracking and analyzing it will give you valuable insights into your performance so that you can take steps to increase profits and grow your business.

Nicky Minh

CTO and co-founder

Responsibilities of a GST Registered Company

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Responsibilities of a GST Registered Company

Singapore’s Goods and Service Tax (GST) requires registration from a few different business types which either operate in Singapore or conduct business with Singapore residents. Those required to file for the GST are primarily businesses operating in Singapore with a taxable turnover exceeding 1 million SGD, or those offering digital or non-digital imported goods or services to Singapore residents. Additionally, some businesses may register voluntarily for this tax as there are potential benefits when conducting transactions with other businesses that have also registered with the GST.

As a GST-registered company, failure to comply with the GST can result in penalties or fines, so it is important for you to understand and fulfill the responsibilities required of you by the GST system. Below, we outline some of the key responsibilities GST-registered companies have.

Charging GST on taxable supplies:

As a GST-registered company you are required to charge GST on taxable supplies of goods and services. Supplies subject to the GST include most goods and services sold in Singapore, however, there are some exceptions (e.g., financial services and residential properties). These supplies and services are subject to a standard rate of 8%.

When conducting transactions that include a GST charge, display your GST registration number on those invoices and receipts and make sure the amount of GST charged is clearly stated.

Collecting GST on behalf of the government:

GST charged to customers needs to be collected and retained so that it can be paid to the Inland Revenue Authority of Singapore (IRAS). Payments need to be made on a regular basis; this is typically once every three months. The amount paid will be dependent on the volume of your GST transactions.

Keep accurate records of your GST transactions and have sufficient funds available to pay the GST when it is due.

Claiming input tax credits:

GST-registered companies are entitled to input tax credits which they can claim for GST paid on business related purchases and expenses. You can claim GST paid on these expenses as a credit against the GST that you have collected from your customers.

To claim input tax credits, you will need to keep accurate records of your GST transactions. Retain valid tax invoices and receipts for all purchases made for your business.

Filing GST returns:

GST returns are used to report your GST transactions to the IRAS. These reports include the GST collected from your customers and the input tax credits claimed for your business purchases and expenses.

You will need to file GST returns regularly. You can do so online through the IRAS e-Service portal or by filling out a hard copy of the GST return form and submitting it by mail, or in person, to an IRAS service center.

Keeping accurate records:

You are required to keep accurate records of your GST transactions. This includes invoices, receipts, and other documents related to your taxable supplies and business purchases. Accurate records are necessary for claiming input tax credits, filing GST returns, and demonstrating compliance with the GST system. You are required to keep these records for a minimum of five years.

Additional responsibilities:

Depending on your specific circumstances, you may have further responsibilities as a GST-registered business in addition to those listed above.

For example, GST-registered companies that import goods into Singapore need to apply for import permits and pay GST on those goods. Similarly, GST-registered companies that supply digital or non-digital services to consumers in Singapore need to register for and charge GST on these supplies under the Overseas Vendor Registration (OVR) scheme.

Final Thoughts

As a GST registered company, you need to be aware of the various rules and regulations that apply to the GST system in Singapore. This includes the requirements for charging, collecting, and paying GST, as well as the rules for claiming input tax credits and filing GST returns. To ensure compliance with these rules and regulations, we recommend consulting with a tax professional and reviewing the information provided on the IRAS website.

Non-compliance with the GST system can result in penalties or fines, so it is important to take your responsibilities seriously and fulfill them properly. Be careful to charge the correct GST rate on your taxable supplies, to accurately report your GST transactions when filing returns, and to keep accurate records of your GST transactions.

Nicky Minh

CTO and co-founder

Registering Your Business for GST

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Guide to Register Your Business for GST

Businesses in Singapore with annual taxable supplies exceeding SGD 1 million are required to register for the Goods and Services Tax (GST). Businesses registered for the GST charge this tax on all goods and services sold in Singapore.

Below is a step-by-step guide for businesses that need to register for the GST:

Step 1: Determine whether you should register for the GST:

Whether or not your business is required to register for the GST depends on two factors:

  1. Annual taxable supplies – businesses whose annual taxable goods and supplies exceed SGD 1 million are required to register for the GST
  2. Type of business – some businesses, such as financial institutions and insurance companies, are required to register for GST regardless of their annual taxable supplies.

Even if your business is not required to register for the GST, you still have the option to register voluntarily. Before doing so, be sure that your company is qualified for this type of registration. Carefully consider the costs and benefits of voluntary GST registration specific to your business. When weighing cost and benefit, consider:

  • Additional administrative costs: Registering for the GST will entail additional costs associated with collecting, filing, and paying GST.
  • Whether your suppliers have registered with GST: This will give you the opportunity to claim input tax on purchases made from your suppliers.
  • Whether your customers have registered with GST: GST customers are more likely to accept a price increase as they will have the ability to claim input tax themselves.
  • International sales: Qualifying international sales incur 0% GST. Depending on the type and volume of international sales made by your company, you may see a reduction in GST costs while retaining the benefits you gain from transactions with GST suppliers.

Step 2: Register for the GST

To register for GST, you need to file electronically using the Inland Revenue Authority of Singapore (IRAS) tax portal. The IRAS tax portal allows you to register for the GST, file returns, and make payments online. When registering for the GST you will need:

  • A Corppass account: If you do not have one, you can apply for one online using your Singpass account on the Corppass website.
  • Supporting Documents: IRAS recommends that any required supporting documents are prepared before beginning the registration process.

Following registration, voluntary GST accounts are required to mail a GIRO application form to IRAS. Your GIRO account will be used for GST payments and refunds.

Step 3: Submit supporting documents

The final step of online registration will require you to submit supporting documents to the IRAS. These may include:

  • Business registration certificate
  • Business profile
  • Partnership agreement (if applicable)
  • Constitution or articles of association (if applicable)
  • Certificate of incorporation (if applicable)
  • Partnership deed (if applicable)
  • Trust deed (if applicable)

The documents required will depend on the type of business you are registering. IRAS provides a detailed list which should be consulted prior to beginning the registration process. Once again, it is advisable to have these documents prepared in advance.

Step 4: Receive confirmation of GST registration

After you have submitted the required documents, the IRAS will review your application and confirm your GST registration. You will then receive a letter of confirmation from the IRAS, which will include your GST registration number and effective date of registration.

Step 5: File GST returns

Once you are registered for GST, you will be required to file GST returns on a regular basis. The frequency of GST returns will depend on your annual taxable supplies. If your annual taxable supplies exceed SGD 1 million, you are required to file GST returns on a quarterly basis. If your annual taxable supplies are SGD 1 million or less, you are required to file GST returns on an annual basis.

You can file GST returns through the ESB platform, or you can use the IRAS GST e-Filing service. When filing GST returns, you need to declare the following information:

  • Total value of taxable supplies made
  • Total value of taxable supplies received
  • GST charged on taxable supplies made
  • GST claimed on taxable supplies received

Step 6: Make GST payments

If you are registered for GST, you are required to pay GST on your taxable supplies. You can make GST payments through the ESB platform or the IRAS GST e-Filing service.

Additional Considerations

Non-compliance with the GST system can result in penalties or fines. It is important to make sure you are fulfilling your tax obligations properly. Be sure to charge the correct GST rate on your taxable supplies, accurately report your transactions, and make payments on time.

Keep accurate and up-to-date records of your GST transactions. This includes invoices, receipts, and other documents related to your GST-registered business. You may be required to produce these records upon request by the IRAS, so it is important to keep them organized and easily accessible.

Seek advice from a tax professional or the IRAS if you have any questions or concerns about your GST obligations. This will ensure that you are complying with the GST regulations and minimizing the risk of penalties or fines.

Registering for GST in Singapore is a straightforward process that can be completed online using the ESB platform. Remember to:

  • charge the correct GST rate
  • accurately report your GST transactions
  • make GST payments on time.
  • keep accurate and up-to-date records of your GST transactions
  • seek the advice of a tax professional

Meeting your GST responsibilities ensures that your business is operating in compliance with the GST system and minimizes the risk of penalties or fines.

Nicky Minh

CTO and co-founder

How to Obtain a Tax Identification Number in Singapore (TIN)

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How to Obtain a Tax Identification Number in Singapore (TIN)

Tax Identification Numbers

A Tax Identification Number (TIN) – also known as a Unique Entity Number (UEN) in Singapore – is a unique identification number assigned to businesses and individuals. Obtaining a TIN is necessary for all businesses operating in Singapore. TINs serve as proof of a business’s legal existence and are used to track tax payments and tax obligations. TINs are used in banking, for transactions made with the government, and when applying for various tax schemes, licenses, and permits.

In Singapore, TIN/UENs are issued by the Accounting and Corporate Regulatory Authority (ACRA). To obtain a TIN, businesses must register their company with ACRA. This can be done online through the BizFile+ portal, or by physically filing at the ACRA Customer Service Centre. Once a company is registered, a TIN will be issued to the business. This TIN can then be found on the company's Business Profile page on the BizFile+ portal.

For individuals, the process of obtaining a TIN is slightly different. Individuals must first register for a SingPass account. Once this account is set up, individuals can then apply for a TIN through the Inland Revenue Authority of Singapore (IRAS) website.

Additional Tax Requirements

Businesses and individuals in Singapore with annual taxable sales exceeding SGD 1 million must also register for the Goods and Services Tax (GST). The GST is a value-added tax levied on the supply of goods and services in Singapore. Businesses must charge GST on all taxable sales, and GST returns need to be filed with the IRAS on a regular basis. The due dates for these returns are typically at the end of the month following the fiscal quarter. For example, most businesses are required to file a GTS for the first quarter by the end of April of that year.

Businesses that fail to file a TIN or fail to comply with tax regulations and filing requirements like the GST are subject to fines, penalties, and other legal consequences. It's important for businesses and individuals to stay up to date with their tax obligations and that they remain in compliance with relevant regulations.

In summary:

  • A tax identification number, or TIN, is a unique identification number essential for businesses and individuals operating in Singapore. (In Singapore the TIN is also known as a Unique Entity Number, or UEN).
  • A TIN allows businesses to register for various tax schemes, apply for licenses and permits, and engage in various business transactions.
  • Businesses operating in Singapore must also register for the Goods and Service Tax, or GST.
  • Obtaining a TIN, registering for the GTS, and complying with tax regulations is essential for businesses and individuals to avoid fines, penalties, and other consequences.

Acquiring a TIN and registering for the GST are basic legal requirements for businesses operating in Singapore, so it is important to remember to fulfil them. Fortunately, these two aspects of getting started in Singapore are easy to accomplish. Registering for a TIN is a simple process that can be accomplished entirely online, and the IRAS provides a wealth of useful resources on their website regarding GST that can help new businesses to better understand their obligations.

Nicky Minh

CTO and co-founder

5 Simple Strategies for Managing COGS

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5 Simple Strategies for Managing COGS

Cost of goods sold (COGS) directly measures the costs incurred when producing products or providing services to customers. COGS is calculated by totaling the sum of raw materials, labor, packaging, and other expenses used during the manufacturing process, or, in the case of service-oriented businesses, all the materials and labor necessary to provide a final service to customers.

COGS is a crucial metric for businesses, and effectively managing it is essential for success. It is a major expense across all industries that directly impacts profits. A thorough understanding of the factors that contribute to COGS can give your business the opportunity to streamline operations, reduce costs, and increase your bottom line. Below are some of the strategies you can use to better manage your business’s COGS.

Inventory Management

Accurately tracking inventory levels and forecasting demand will minimize waste and reduce the cost of excess inventory. This can be done using systems to track inventory levels in real-time, or by establishing policies for regular reviews. These two methods can also be used in concert with one another, with regular reviews giving you an opportunity to reassess long-term goals while real-time inventory tracking acts as a way of reinforcing the importance of inventory management in your daily operations.

Keeping abreast of your current inventory will allow you to make adjustments that align with demand. Having sufficient inventory to meet demand is critical for the success of your business as having insufficient inventory to meet demand will lead to customer dissatisfaction and loss of sales. However, a surplus of inventory can restrict your cash flow, leaving your money tied up in assets that can’t be readily moved. Reducing excess inventory will free up capital that can be better used to invest in your company’s growth.

Supplier Negotiation

Establishing long-term relationships with suppliers and regularly reviewing your contracts will give you an advantage when negotiating with your suppliers. The terms and prices laid out in your contracts can be subject to change over time, so always be aware of what other vendors are available to you and what rates they offer. Building strong relationships with your vendors and understanding the market in which they operate will help you secure favorable terms and prices for the materials and supplies you need to produce your products or to provide your services.

Lean Manufacturing

Emphasizing the elimination of waste and inefficiency in all aspects of the production process streamlines operations. Finding ways to eliminate unnecessary steps can reduce the cost of producing products or providing services. The fundamental principles behind lean manufacturing are echoed in various production methods across a wide variety of industries. Essentially, this approach boils down to the old adage “time is money.” The less time your product spends in the manufacturing process, the lower its final cost, and lower costs widen your margins.


Investing in automated systems can reduce the need for labor and reduce the cost of production. However, it's important to carefully consider the upfront costs of automation and ensure that it will result in long-term cost savings. Labor costs are often some of the most expensive costs associated with COGS, however, automated solutions aren’t always cheaper.


In some cases, outsourcing certain production processes or tasks to specialized vendors can be more cost-effective than performing those tasks in-house. However, it's important to carefully consider the potential risks and challenges associated with outsourcing, such as quality control and delivery times.

Final Thoughts

The methods for reducing COGS are influenced by a wide variety of outside factors. However, the fundamental principles behind COGS reduction are simple: simplified processes, efficient use of labor, favorable vendor contracts (i.e., understanding your suppliers’ markets), and knowing when to outsource.

By implementing the strategies above and regularly reviewing and analyzing COGS data, you can effectively control and reduce costs, allowing you to increase your business’s profitability and long-term success.

Nicky Minh

CTO and co-founder

Disbursement and Reimbursement: Understanding the Difference

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Disbursement vs Reimbursement: Understanding the Difference

In the world of finance, the terms "disbursement" and "reimbursement" are commonly used but often misunderstood. Both are essential aspects of managing financial transactions, but there are important differences between them. Ensuring accurate accounting practices requires an understanding of these differences.


Disbursement refers to the process of paying out or distributing funds from one party to another. Disbursements are typically made to fulfill a financial obligation. It can occur in various contexts, including loan disbursements, payroll distributions, or payments to suppliers.

Examples include:

  • A bank disbursing a loan to a borrower
  • A company disbursing salaries to its employees
  • A government agency disbursing grants or subsidies


Reimbursements are repayments made to an individual or entity for expenses they have incurred on behalf of another party. It is a common practice in organizations where employees pay for work-related expenses and later submit expense reports to be reimbursed by the company.

Examples include:

  • An employee being reimbursed for travel expenses incurred during a business trip
  • A company reimbursing a client for a product return or a refund
  • A health insurance company reimbursing policyholders for medical expenses

How Disbursements and Reimbursements Differ

Although disbursement and reimbursement both involve the transfer of funds, they differ in several ways:

  • Purpose: Disbursements are made to fulfill financial obligations or financial agreements. Reimbursements are repayments to someone for expenses they have already incurred on behalf of another party, typically the person or organization making the payment.
  • Timing: Disbursements typically occur before or during the process of fulfilling an obligation, such as paying a supplier or distributing a loan. Reimbursements are made after the expenses have been incurred and documented.
  • Documentation: Disbursements generally require documentation outlining agreed-upon terms of payment, for example, invoices or contracts. Reimbursements require proof of expenses incurred before funds are repaid. Receipts or expense reports are commonly used as proofs of purchase.
  • Recipients: Disbursements are made to a wide variety of individuals and organizations, and for an equally wide variety of reasons. Some examples of disbursement recipients include employees, suppliers, borrowers, and government agencies. Reimbursements are made to individuals or entities who have incurred expenses on behalf of another party, such as employees or customers.
  • Nature of the Transaction: Disbursements are often planned and scheduled transactions, such as loan distributions or payroll payments. Reimbursements are more unpredictable, as they are dictated by the timing and nature of the expenses incurred.

Understanding the differences between disbursement and reimbursement is essential for maintaining accurate financial records and ensuring compliance with accounting standards. By recognizing the distinctions between these two terms, you can better manage your organization's finances and avoid potential misunderstandings or discrepancies in financial reporting.

Nicky Minh

CTO and co-founder

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