If you’ re looking for a country that appreciates and wants new businesses and is willing to prove it with low tax rates, then look no farther than Singapore. The country has purposely created a tax structure that includes low corporate tax rates and a number of generous special exemptions and tax incentives. In fact, during a time when most countries were considering raising taxes, Singapore lowered its top corporate tax rate from 18% to 17% starting in 2010. This continues a history of tax reductions that have significantly contributed to Singapore’s growth.
- All companies, whether foreign or local owned, enjoy a flat tax rate
- Tax structure that provides for some of the lowest corporate tax rates in the world at 9 percent on chargeable income up to S$300,000 and a maximum rate of 17% on chargeable income above S$300,000
- Full tax exemption for qualifying start-up companies for first 3 years of business on chargeable income up to first $100,000
Partial tiered tax exemption given to businesses on qualifying chargeable income up to first $300,000
No capital gains taxes meaning tax free dividend distributions to shareholders - Tax incentives like the Productivity and Innovation Credit that rewards cutting edge product and service development and the Regional Headquarters Award that grants a concessionary tax rate for meeting criterion concerning increased Singapore business income levels
- One-off capped cash SME Cash Grant or casino the CIT Rebate (whichever is higher) awarded to Singapore companies to offset operational expenses
- Indefinite loss carry forward if offsetting statutory income not availableIn addition, Singapore has over 50 tax treaties in place, with new ones added each year, that ensure companies doing business in partnering countries are not subject to double taxation. These treaties, called an Avoidance of Double Taxation Agreement, include countries in Asia and Europe, China, and Canada. The treaties are either comprehensive and covering all income types, or limited, meaning they include only shipping and air transport income. The agreements are instrumental in promoting trade, stimulating the economy and increasing market accessibility.
There’s a lot to appreciate in Singapore’s corporate tax structure because Singapore appreciates business. The generous corporate tax structure ensures a business is not burdened with taxation issues. By the way, the same philosophy applies to individual tax rates also making it much easier to attract a quality workforce.
