A company is tax resident in Singapore if the control and management of its business is exercised in Singapore.
Foreign dividends, branch profits and service income (attributable to a foreign permanent establishment of the Singapore tax resident company) received by a Singapore tax resident company are exempt, provided these are derived from a jurisdiction operating corporate tax rates of at least 15% and have been subjected to tax in that jurisdiction.
Income is taxable in Singapore if the source of income comes from Singapore. Branches of foreign corporations are usually viewed to be carrying on business in Singapore and are as such, considered to have derived Singapore sourced income.
In addition, the Income Tax Act deems interest and other charges related to indebtedness, royalties, rents, technical fees and management fees to be derived from Singapore if these are either borne by a Singapore resident entity or permanent establishment or are deductible against Singapore-sourced income. Foreign companies receiving such payments from Singapore may be subject to withholding taxes.
Generally, resident and non-resident companies are treated in the same manner except that non-resident companies may not benefit from double taxation agreements that Singapore has entered into with other countries.
Click here to download the Doing Business in Singapore 2023 guide
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