A company’s liability for GST registration depends on the value of the taxable turnover. This refers to the value of goods and services supplied by the company, which are regarded as taxable supplies for GST purposes.
Moreover, the GST registration process of a company in Singapore differs slightly depending on the type of registration and constitution of its business. While registering, you can take either retrospective or prospective view.
In summary, a company must register for GST in Singapore if:
- Your taxable turnover at the end of the calendar quarter (i.e. 3 months ending March, June, September or December) prior to January 1, 2019, and the past three quarters is more than $1 million. You will have to monitor at the end of every calendar quarter and register for GST if your taxable turnover for the past 12 months exceeds $1 million.
- Your taxable turnover at the end of any calendar year on or after January 1, 2019, is more than $1 million. For periods on or after January 1, 2019, taxable turnover will be computed on a calendar year basis for the purpose of determining registration liability. You have to monitor at the end of every calendar year (i.e. December 31) and register for GST if your annual taxable turnover exceeds $1 million.
- If at any time, you can reasonably expect your taxable turnover in the next 12 months to be more than $1 million. While you do not need to register for GST if there is no certainty that your taxable turnover will exceed $1 million in the next 12 months, based on a forecast taking into account market assessment, business plans or sales targets.
You must have the following supporting documents to support your forecast value of $1 million:
- signed contracts or agreements
- quotations accepted by customers
- confirmed purchase orders received from customers
- invoices to customers with fixed monthly fee charged
- income statements showing that past 12-month period was already close to $1 million and that annual turnover is on an increasing trend
GST on Imported Services in Singapore
Based on current GST rules, services (other than an exempt supply) supplied by a supplier who belongs in Singapore is subject to GST while the same services supplied by a supplier who belongs outside Singapore is not. Thus, to level the GST treatment for all services consumed in Singapore, it was announced in Budget 2018 that the following regimes will be implemented from January 1, 2020, to tax imported services:
Reverse charge regime for Business-to-Business (“B2B”) supplies of imported services
- This means that if you are a GST-registered business, from January 1 2020, you will be required to account for GST on all services that you procure from overseas suppliers (“imported services”) as if you are the supplier, except for certain services which are specifically excluded from the scope of reverse charge. You will be entitled to claim the corresponding GST as your input tax, subject to the normal input tax recovery rules.
- Else, if you are a non-GST registered business, from January 1, 2020, if the total value of your imported services for a 12-month period exceeds S$1 million, you may become liable for GST-registration under the new GST registration rules. Once registered for GST, you have to account for GST on both your taxable supplies and your imported services which are subject to reverse charge.
Overseas vendor registration regime for Business-to-Consumer (“B2C”) supplies* of imported digital services
- This means if you belong outside Singapore, you are required to register for GST in Singapore if you have an annual global turnover exceeding $1 million; and make B2C supplies of digital services to customers in Singapore exceeding $100,000. Once registered for GST, you are required to charge and account for GST on B2C supplies of digital services made to customers in Singapore.
- Under certain conditions, whether you are a local or an overseas operator of an electronic marketplace, you may be regarded as the supplier of the digital services made by the overseas suppliers through your marketplace. In such cases, you are required to include the value of these services to determine your GST registration liability. If you are liable for GST registration or are already GST-registered, you are required to bill and account for GST on B2C supplies of digital services made through your marketplace to customers in Singapore on behalf of the overseas suppliers, in addition to digital services made by you directly to customers in Singapore.
- To ease extra-territorial compliance burden, if you are an overseas operator, you will be registered under a simplified regime, with reduced registration and reporting requirements.
Please note that in the above, B2B supplies refer to supplies made to GST-registered persons, including companies, partnerships and sole-proprietors. Where as B2C supplies refer to supplies made to non-GST registered persons, which include individuals and companies that are not registered for GST.
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Group Registration of GST in Singapore
Group registration is a facility in Singapore, which allows several companies to report GST (e.g. submit GST return) as a group instead of reporting individually. Under group registration, one of the companies will be nominated by the group as the representative member, and GST registration is done in the name of this representative member.
There are several benefits of Group Registration including:
- GST reporting is easier due to centralised administration
- supplies made between companies under the group are not subject to GST
Register your company for GST in Singapore
The GST registration process for a company in Singapore differs slightly depending on the type of registration and constitution of its business. Let us help you understand what is required.