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![]() ![]() For instance, dividend income is sourced where the dividend paying company is tax resident in. References are made to case law in determining the source location of income/gains and the tests which are applicable may differ depending on the types of income/gains. There is no definition in the Income Tax Act of what constitutes Singapore source or foreign source, aside from specified income items such as interest and royalty income. The above also makes reference to Singapore and foreign sourced income. ![]() Generally, gains on disposal of assets are considered income in nature if they arise from or are otherwise connected with the activities of a trade or business carried on in Singapore. The determination of whether a receipt is income or capital in nature is generally done with reference to case law and based on the facts and circumstances of each case. ![]() ![]() There is no definition of what constitutes income and capital in the Income Tax Act. Singapore does not impose tax on capital gains. The prevailing corporate income tax rate is currently 17% and the prevailing personal income tax rate is progressive up to 22%.Īs noted above, Singapore tax is imposed on income. What this means is that tax is imposed on income which has its source in Singapore as it arises, but only imposes tax on income sourced elsewhere (foreign-sourced income) when it is received in Singapore. Singapore operates on a quasi-territorial basis of taxation. This section provides a general introduction to various concepts under the Singapore taxation regime for start-up founders or business owners to consider from financing/funding, operational and human resource perspectives.Ī. As Singapore is a leading start-up hub in Asia, the Government implements tax policies and incentives that support start-up businesses. Whilst commercial considerations are important in operating a company, start-ups should not omit tax considerations as it could otherwise increase the costs of doing business and erode returns to founders and/or investors. This article provides a general introduction to various concepts under the Singapore taxation regime for startups or business owners to consider, from financing / funding to operational and human resource perspectives.
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