Frequently Asked Questions
Can we request payroll processing for only a few selected employees?
Yes, we can process payroll for all or a few selected employees. Please note that there is a minimum charge of S$30 per employee inclusive payroll computation and submission of CPF return on a monthly basis.
How long does it take to process the monthly payroll?
It takes one working day to process the monthly payroll. We will send you the payroll summary report for you to arrange the monthly payroll to your employees. Also, we will submit the CPF return before due date and send you the CPF statement for your records.
We have expatriate employees, can you help me!
Yes, we can! One of our specialties is managing expatriate payroll and personal income tax return. We can assist to compute the personal income tax return and advise the expatriate the areas to take note of upon filing the income tax return.
How many times can I request for the monthly payroll?
There is no limit to the number of payroll processes you can do in a month as our payroll services is charged based on number of headcount per month.
What must employers do for employees by 1st March yearly with regards to tax filing?
As an employer, you must prepare Form IR8A and Appendix 8A, Appendix 8B or Form IR8S (where applicable) for all your employees (who are employed in Singapore) before 1st March each year.
Why you should outsource your payroll process?
- Minimal cost of Payroll processing. Not necessary to invest in costly software and training of employees to process monthly payroll
- Errorless Payroll processing
- Access to year-end tax support, including IR8A or AIS as a part of our payroll services
- Assurance to stay updated with legislative changes and statutory reporting requirements
- Assurance of confidentiality
- Focus on revenue generating activities and increase the productivity of your business in a cost efficient manner.
AUDIT AND ASSURANCE SERVICES
Does my company require an annual audit?
Companies meeting at least two of the following criteria are required to have their accounts audited:
• Annual revenue exceeds S$10 million;
• Value of company’s total assets exceeds S$10 million;
• Number of employees exceeds 50.
Are audit fees regulated and is there a scale for fees?
Audit fees are not regulated yet and there is no scale reference for audit fees. Auditors generally charge fees according to time spent, risk involved and complexity of the accounts on the audit assignment. Fees also reflect the level of skill, expertise and experience required and the level of responsibility and complexity involved in the audit engagement. Alternatively, fees are charged on agreed terms between the auditor and the client before commencement of audit.
Why do Singapore companies have audits?
Companies engage an audit for a number of reasons. Larger companies are required to audit as required by law, but many companies will consider audit even if there are no statutory obligation. An independent audit is crucial to good corporate governance and essential to an effective internal financial control function.
Above all, an audit adds credibility to information provided to shareholders. It provides assurance to investors and other providers of finance who are able to make their decisions in a safe environment with confidence. Safety and confidence reduce the cost of capital and make companies competitive and profitable.
Companies invest in an audit in order to:
- Satisfy stakeholders such as employees, customers, suppliers and group, as well as the investing community, as to the credibility of published information
- Facilitate the payment of corporate tax, goods and services tax (GST), and other taxes on time and accurately, thereby avoiding interest, penalties and investigations
- Comply with banking covenants
- Help deter and detect material fraud and error
- Facilitate the purchase and sale of businesses
- Take advantage of the spin-off benefits such as advice on the structure and operations of systems
- Demonstrate good corporate governance
What are the benefits of auditing to a company?
Auditing reinforces early fraud detection. Outsourcing the services of a professional auditor can abolish the presence of fraud in your company. The auditing process unveils faults and errors (innocently or deliberately committed) of employees and exposes the occurrence of financial frauds. An audit can therefore serve as a reminder to your workforce that any deviation from ethical work practice will not go undiscovered and possibly, unpunished. A company whose accounts are subjected to regular audits therefore enjoys immunity against fraud and scam because of the early detection of discrepancies that goes with auditing.
Auditing enhances a company’s efficiency. Auditing enables you to acquaint with your own financial system and enjoy a more profitable corporate existence. With the assistance of a good auditor, you have an efficient business entity – risks are effectively analysed and studied so costs are held to a minimum.
Auditing helps you make pragmatic decisions. An audit helps you identify your financial activities and understand your company’s fiscal strengths and weaknesses. When you are aware of the situation, you can make pragmatic decisions to address weaknesses, focus on key areas for improvement and enhance well-known strengths.
How long will the audit take?
The length of time to conduct the audit varies by entity. There are a number of factors, such as the volume of the transactions, potential findings, and the complexity of accounts. Tentatively, we expect to be on field works 3 to 10 working days and reports to be issued within 2 to 3 months.
Does my company have to adhere to certain accounting standards for compliance purposes?
Any company incorporated in Singapore must prepare the accounts in accordance to Companies Acts and Singapore Financial Reporting Standards (SFRS). Auditors audit the accounts based on the Singapore Standards of audit and express true and fair opinion to the accounts. However, depending on the nature of the company’s accounts, not every standard need to be adhered to.
Why should smaller companies invest in a voluntary audit?
The annual statutory audits add value to a company. Smaller companies invest in audits for the same reasons as larger companies, but there are particular issues facing smaller companies that make investment in an audit worthwhile:
- The cost of the audit is often marginal for small companies, particularly where the auditor is involved in the preparation of the statutory accounts.
- Small companies who prepare their own accounts often need help in arriving at adjustments, such as those for obsolete stocks, bad debts and other provisions
- Small companies grow, and may find themselves subject to a statutory audit requirement – the first year and the subsequent years of an audit can be very trying if the accounts are not in good order
- An audit is essential in financing negotiations, take-over and buy-out
- The close involvement of the auditor provides companies with comfort when faced with tax and regulatory investigations
Most of the directors of smaller companies may believe that because there is no longer any statutory audit requirement, there will no longer be any external ‘checking’ of the books and records. The power and resources of the Inland Revenue Authority of Singapore are not to be underestimated and increasing all the time. This means that there are likely to be more investigations in the future.
What kind of tax services does your firm provide?
At Corporate Services Singapore, our trusted Tax professionals will keep you abreast of any developments that may affect your business. We ensure that you are 100% tax compliant, whilst meticulously securing every tax deduction your business is legally entitled to.
Here’s a list of the wide range of Tax Services we provide:
- Preparation and filing of Estimated Chargeable Income (ECI)
- Preparation and filling of Corporate Income Tax Return (Form C or Form C-S)
- Detailed Tax Computation
- Preparation of Supporting Schedules for tax computation
- Preparation of audited or unaudited financial statements to be submitted to IRAS
- Expatriate tax services
- GST compliance (application and submission)
- GST advisory and review
- Corporate tax compliance
- Personal and partnership tax services
- Tax planning and advisory (tax incentives and exemption)
- Withholding tax services
- Cross border tax advisory
What is the corporate tax rate in Singapore?
The corporate income tax rate is flat at 17% in Singapore. For annual taxable profits of up to S$300,000, full tax exemption is available for newly incorporated companies with individual shareholders will be taxed as follows:
- The first S$100,000 in annual taxable profits will be tax exempt for the first 3 years.
- The next S$200,000 in annual taxable profits will be taxed at 8.5%.
- Taxable profits above S$300,000 will be taxed at the flat rate of 17%.
Total tax payable for the first S$300,000 taxable profits is S$17,000, the effective tax rate is 5.67%.
Newly incorporated companies with corporate shareholders or 4th years for companies with individual will be taxed as follows:
- The first S$300,000 in annual taxable profits will be taxed at 8.5%.
- Taxable profits above S$300,000 will be taxed at the flat rate of 17%.
Is a private limited company required to file audited accounts?
Companies that meet the following criteria are required to have their accounts audited:
- Corporate shareholders; and
- Total number of shareholders is more than 20; and
- Annual revenue exceeds S$10 million.
All other companies are not required to file audited accounts and can file unaudited financial statements.
What expenses are tax deductible, and what are not?
You can claim deduction for expenses that are wholly and exclusively incurred from the production of income.
To qualify for tax deduction, the expenses must:
- Be revenue-focused in nature. This covers normal day-to-day expenses, but excludes capital expenditure.
- Not be prohibited under the Income Tax Act.
- Have actually been incurred. Contingent liability is not allowed for tax deduction.
What is ECI? Who needs to file it? What are the benefits of filing?
“ECI” stands for Estimated Chargeable Income. It is an estimate of a company’s chargeable income for a Year of Assessment (YA).
A company has to furnish Estimated Chargeable Income (ECI) within three months after the financial year end of the company.
If you furnish your company’s ECI within the qualifying period, you can pay your tax by instalments basis. The earlier you furnish your ECI, the higher the number of instalments available.
What is GST? When is a company liable to register for GST?
GST stands for Goods and Services Tax. The company is liable to register for GST when its annual taxable turnover is more than S$1 million or it is currently making taxable supplies and its annual taxable turnover is expected to be more than S$1 million for the next 12 months. A company may choose to register for GST voluntarily if the annual sales turnover is less than S$1 million, however, the company needs to remain as GST registered company for at least 2 years.
Is filing corporate income tax return compulsory if my company did not make any profits or is making losses during the year?
Yes, it is mandatory. All Singapore incorporated companies are required to file a tax return on an annual basis. Although the company is making losses, the losses still have to be submitted via tax return to IRAS. The losses can be utilised to set off against future profits of the company.
What is the due date for filing corporate income tax return?
The due date for filing corporate tax return in Singapore is November 30 annually. The tax return is filed on a prior year basis i.e. any financial year end fall in 2016 will need to file tax return for the financial year on 30 November 2017. The filing deadline is extended to 15 December, if the company is e-filing the tax return.
However, each company is required to file an Estimated Chargeable Income (ECI) within 3 months of the end of its financial year to IRAS.
Is company profit distribution as dividends to shareholders taxable?
No. Singapore adopts one-tier corporate tax system; tax paid by a company on its chargeable income is the final tax. All dividends paid by a company are exempt from tax in the hands of the shareholders.
How What we can help you for in filing your corporate income tax?
We will advise and update you on the corporate income tax matters so that your company’s tax obligation is in compliance to the Income Tax Acts. It includes:
- Preparation and submission of Estimated Chargeable Income (“ECI”) within 3 months from financial year end.
- Corporate income tax computation of the tax payable of company.
- E-filing of tax return of Form C or Form C-S to IRAS.
- Assisting your company to verify the Notice of Assessment upon receipt of the assessment from IRAS and deal with corporate income tax queries raised by IRAS if any.
Does a dormant company need to submit tax return of Form C-S?
A dormant company must submit Form C-S unless it has been granted waiver for submission of tax return by IRAS.
How does GST work?
Upon registering GST, a business must charge and account for GST at the prevailing rate (7%). This is known as output tax. GST registered businesses can also claim from IRAS the GST incurred on their goods and services purchased assuming certain conditions are met. This is known as input tax.