Claiming Foreign Tax Credit for Foreign Income Received in Singapore

Generally, when a Singapore company received income from abroad, it is taxable in Singapore. In most cases, this same income may also be subjected to tax in the foreign country. This will result in double taxation where the same source of income is taxed twice.

Fortunately, Singapore tax residents are allowed to claim a foreign tax credit for the tax paid in the foreign country. This is a relief provided under the avoidance of double taxation agreements that Singapore has signed with other countries.

Under the foreign tax credit system, Singapore tax residents can claim a credit for the amount of tax paid in the foreign jurisdiction against the Singapore tax that is payable on the same income. The foreign tax credit that can be claimed is the lower of the actual amount of foreign tax paid or the amount of Singapore tax attributable to the foreign income (net of expenses).

For more details, contact an expert tax agent in Singapore!


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ACRA Cancels Registration of Filing Agent and Qualified Individual for AML/CFT Breaches

The Accounting and Corporate Regulatory Authority (ACRA) had cancelled the registrations of filing agent (RFA) and qualified individual (RQI) on 18 January 2024. The registrations were cancelled in view of breaches of anti-money laundering and countering the financing of terrorism (AML/CFT) controls under the ACRA (Filing Agents and Qualified Individuals) Regulations 2015 (the “ACRA Regulations”).

Some of the basic AMT/CFT controls that a RFA and RQI are required to exercise are as follows:

(a) perform additional customer due diligence measures when a customer is not physically present during onboarding;

(b) inquiring if there exists any beneficial owner in relation to some of its customers; and

(c) perform risk assessments i

RQIs and RFAs provide corporate secretarial services for business entities, such as helping customers to incorporate companies, file annual returns and fulfil other filing requirements under the Companies Act 1967 or other Acts under ACRA’s purview. RQIs and RFAs are required to perform customer due diligence measures in accordance with the ACRA Regulations, and conduct their business in such a manner as to guard against the facilitation of money laundering and the financing of terrorism. RQIs and RFAs must also satisfy statutory requirements such as being fit and proper persons, to be registered or continue to be registered.

RQIs and RFAs who breach their statutory obligations may be subject to enforcement actions, such as financial penalties of up to $10,000 or $25,000 per breach respectively or have their registrations with ACRA suspended or cancelled.

Therefore, RQIs and RFAs play an important role in helping to detect and combat illicit activities.

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