IRAS Releases Updates On Tax Filing Requirements For Small Businesses
Singapore has eased the tax burden of small business owners as it rolls out new updates on its tax filing requirements for small companies effective this year. Inland Revenue Commissioner Moses Lee announced that the Inland Revenue Authority of Singapore (IRAS) has streamlined the procedure for the filing of the Income Tax Return (Form C) and Estimated Chargeable Income (ECI) of companies so that small companies can focus more on maximizing their profits in Singapore’s competitive business environment.
“We recognize that small companies face greater challenges in managing their tax obligations,” said Lee in an article published by SMB World Asia. “Their resources are already highly stretched, as they struggle just to keep up with their day-to-day operations and focus on business viability.”
Current tax rules require Singapore companies to file their ECI form along with their Form C within three months at the end of their effective year of assessment. This rule does not exempt companies that didn’t gain nor have any taxable profits.
According to Lee, companies with less than SG $1 million turnover can use the Form C-S when filing their income tax return for the current year of assessment. This will help cut down the entire length of filing time by 50% since smaller companies have fewer tax claims and adjustments. The companies can also to choose the file their form C-S online through the IRA website.
For the 2013 year of assessment, companies that do not have any taxable income or earned less than SG $1 million are no longer required to submit their ECI form.
The said changes to the tax filing procedures are seen to affect a huge chunk of Singapore’s small and medium enterprises. Lee said that over 42% of companies (67,000 companies) will benefit from the ECI waiver while 70% of all Singaporean companies will benefit from the updated Form C-S.
The simplified tax filing procedures are also seen to improve the efficiency of the Singapore tax system and increase the productivity of smaller companies.