Good and Services Tax (GST) is also known as value-added tax. It is mandatory for a company to register for GST in Singapore if the turnover reaches more than S$ 1 million in 12 months.
In Singapore, the GST rate is 7%. It applies to most goods and services that are exchanged in Singapore. If it’s exported from the country, the rate is 0%. Upon registering for GST, the company needs to collect the tax. There are two ways to do it. Firstly, to include the tax into the price of the goods and services offered. Secondly, which is more commonly used, is to charge the customer. For example, if you are selling a book for $35, you charge the buyer $37.45. The additional $2.45 is the 7% GST.
GST is mandatory in these two scenarios: – In the yearly assessment, your business has more than S$1 million in revenue- You are planning and expecting for more than S$1 million of turnover in the next one year.
Check out with your accountant if you are unsure whether your company is required to register for GST.
Registration for GST has to be made within 30 days after your revenue exceeds S$1 million. If you fail to register within 30 days, penalties will be imposed by IRAS.
HOW TO REGISTER FOR GST?
Fill up GST F1 and F3 forms and submit it to IRAS. Include the paperwork as required in their checklist. The process takes about 10 days. Upon approval, you will receive your GST number, filing frequency, and filing due dates.
DE-REGISTRATION OF GST
You can de-register once your company’s revenue is less than S$1 million a year. To apply this, you need to submit supportive documents showing the revenue projections.
Here is a list of items exempted from GST:
– Sale of unfurnished residential property
– Investment of precious metal
– Bitcoin or similar digital payment tokens
– Export of goods
– International flight tickets