Industry-specific Guidelines for GST in Singapore

There are specific guidelines that businesses in each  industry need to keep in mind when it comes to GST.

Advertising

Your supply of advertising service attracts GST unless it qualifies for zero-rating as an international service under section 21(3) of the GST Act. The GST treatment for advertising services is based on the nature of services.

Aerospace and Aviation

Some international services under Section 21(3) of the GST Act performed in connection with an aircraft qualify for zero-rating. There is also the Approved Import GST Suspension Scheme (AISS) detailed below. 

Air and Sea Containers

Where the supply qualifies as an international service under Section 21(3) of the GST Act, you may zero-rate the supply of service (i.e. charge GST at 0%).

Biomedical

GST relief is however granted for medicinal products (including pharmaceutical products) imported into Singapore so long as they are for local clinical trials, re-export for overseas trials, or destruction/ disposal. Under the relief, no import GST is payable upfront on the importation of such products.

Construction

You need to account for GST on the supply of construction services in Singapore. If the construction services qualify as international services under Section 21(3) of the GST Act, you may zero-rate the supply.

Need expert input on what businesses in your industry need to do regarding GST? Talk to a GST services provider.

Consultancy and Professional Services

Consultancy services (e.g., legal, accounting, engineering service) and other similar professional services are subject to GST unless they qualify as international services under Section 21(3) of the GST Act.

Finance

When the financial services provided fall within the 4th Schedule of the GST Act, the services are exempt supplies. No GST needs to be charged for exempt supplies.

Examples of these financial services that are exempt supplies include:

• Provision of loans;
• Issue / sales of shares or bonds;
• Provision of life policy by an insurance company;
• Charges by banks for the operation of bank accounts;
• Exchange of currency; and
• Provision of derivative that does not lead to any delivery of goods or services.

Manufacturing

For GST purposes you are making a supply of goods when you:

• manufacture your own goods for sale; or
• process and treat your customers’ original goods such that new or different goods are produced as a result (i.e. there is a change in the character or nature of the original goods).

When there is no change in the character or nature of the original goods after the process and treatment, then you are making a supply of services for GST purposes.

For goods that are delivered directly from a place outside Singapore to another place outside Singapore, the supply is outside the scope of GST (i.e. out-of-scope supply). No GST needs to be charged for such supplies and you do not need to declare them in your GST return. However, you are required to maintain supporting documents (e.g. bill of lading, air waybill) to demonstrate that the supply is an out-of-scope supply.

Marine and Shipping

Zero-rating of supplies relating to ships, management of ships, etc. and changes introduced by Budget 2011 including the launch of the Approved Marine Customer Scheme and expanded scope of s21(3)(p).

Real Estate

The sale and lease of properties in Singapore are subject to GST except for residential properties. GST is also chargeable on the supply of movable furniture and fittings in both residential and non-residential properties. Real estate agents must charge GST on the brokerage fees received from the real estate agencies.

REITs and Registered Business Trusts

In Budget 2008, the Government announced a GST concession to allow Real Estate Investment Trusts and qualifying Registered Business Trusts listed on Singapore Exchange (i.e. S-REITs and qualifying S-RBTs) to claim GST on expenses incurred for their business and their Special Purpose Vehicles (SPVs). This GST concession applies regardless of whether S-REIT or S-RBT is eligible for GST registration.

This concession is an enhancement to the GST concession for S-REITs introduced in 2006. The qualifying period will be from 17 Feb 2006 to 31 Mar 2020.

In Budget 2015, the Government announced a further enhancement on the GST concession to allow S-REITs and qualifying S-RBTs to claim GST on expenses incurred to set up SPVs used solely to raise funds for the S-REITs or qualifying S-RBTs, and the SPVs do not hold qualifying assets of the S-REITs or qualifying S-RBTs, directly or indirectly. These S-REITs and qualifying S-RBTs will also be allowed to claim GST on the business expenses of such SPVs. The enhancement will apply to GST incurred from 1 Apr 2015 to 31 Mar 2020.

Telecommunications

You are required to charge GST on local telecommunication services. Where the supply qualifies as an international service, you may zero-rate the supply of service (i.e. charge GST at 0%).

Do you know the details regarding GST filing for businesses in your industry? Consult a qualified GST services provider in Singapore.

Travel

You need to charge GST to your customer for the services. For services which qualify as international services under Section 21(3) of the GST Act, you may zero-rate your supply of service (i.e. charge GST at 0%).