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:
- Annual taxable supplies – businesses whose annual taxable goods and supplies exceed SGD 1 million are required to register for the GST
- 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.
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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.
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.