An Overview of Singapore Corporate Tax System

Singapore is renowned for its appealing corporate tax rules, which include low taxation on
profits, generous tax relief options, and single-tier corporate tax system. Organizations doing
business in any capacity in Singapore must pay tax on all profits gained within the country.
Foreign income is taxed once remitted.

The Inland Revenue Authority of Singapore (IRAS) oversees all corporate taxation processes,
including tax collection, policy reviews, economic monitoring, and more. Its primary aim is to
generate economic growth within Singapore by creating a tax environment that attracts

What types of taxes affect companies in Singapore?

Corporations may be liable to pay the following taxes in Singapore:

  • Corporation Tax: All profits collected by companies are taxed (see below for rates)
  • Customs and Excise Duties: Singapore’s excise and import duties are relatively scant,
  • mainly affecting liquors, petroleum products, and tobacco.
  • Stamp Duty: This tax affects immovable property, and stocks and shares.
  • Foreign Worker Levy: This tax aims to limit and regulate the employment of foreign workers in the country.

Income tax rates

Corporate tax rates are imposed at a standard rate of 17% to maintain a competitive tax environment and attract foreign investment. However, partial exemptions are available for start-ups (not including investment holding companies or property developers).

Singapore’s one-tier corporate tax system means that taxes on profits are not imputed to shareholders. In other words, dividends are tax-free.

Tax residency status

Companies controlled and managed within Singapore are considered tax residents. Companies whose board meetings occur outside of the country are generally considered non-residents. The rules affecting residents and non-residents are similar, but resident companies are eligible for income tax exemption schemes and exemptions on foreign branch profits and dividends. Resident companies are also entitled to benefits laid out in the Avoid of Double Taxation Agreements (DTA).