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Goods And Services Tax In Singapore – Foreign Company Requirement To Register For GST

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Any company whether local or foreign that intends to supply goods and services in Singapore and expects that their supply will exceed S$1 million per year must register with the Inland Revenue Authorities for GST.

GST also known as Goods and Services Tax is a broad based tax on the supply of goods and services in Singapore.

As a foreign company who wishes to supply goods and services in singapore, the authorities provides two alternatives, the first of which is under section 33(1) known as Section 33(1) agent. The foreign company has to register with the authorities for the purposes of GST. It also has to appoint a local person or body under Section 33(1) that acts on the foreign company behalf on all GST matters. This section 33(1) agent is responsible for the accounting and payment of GST.

The position of the Section 33(1)agent is such that it becomes responsible for all matters of payment and liabilities of the foreign company. In essence it represent the foreign company as such that the Section 33(1) agent and the foreign company are one and the same. This would mean that should the foreign company not be able to pay for its GST tax liabilities for any reason, the local agent becomes liable for the payment. In this situation, the overseas company supplies the goods locally and collects the GST that is payable to the authorities. What control does the Section 33(1) agent has over the transactions.? Therefore only the brave would venture to offer themselves as a section 33(1) agent.

Another alternative,is the section 33(2) agent, where the overseas company does not need to register for GST but it appoints an agent under this section. The section 33(2) agents then acts as the principal and all goods imported or purchased are in his "hands". The section 33(2) agent then supplies the goods and account for the GST. In this scenario, the Section 33(2) agents has "control" over the transactions.

Therefore it is easy to see why there is very little information on section 33(1) agent.

Sandhurst Consultancy Pte Ltd provides advice and guidance to those interested to set up a business in Singapore.

Sandhurst Consultancy Pte Ltd provides advice and guidance to those interested to incorporate a company in Singapore. In addition Sandhurst Consultancy also provides accounting and tax advice, corporate secretarial services and migration services.

Author: Sukhbir Singh
Article Source: EzineArticles.com
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