13 October 2014

On 10 October 2014, the Inland Revenue Authority of Singapore (IRAS) issued an e-Tax Guide, “Liberalised treatment of expenses incurred in Singapore to derive foreign income” which sets out details on the liberalised tax treatment of expenses incurred in Singapore to derive foreign income remitted to Singapore.

Expenses incurred in Singapore in any year to derive foreign income are not deductible unless the foreign income is remitted to Singapore in the same year.

Under the liberalised tax treatment, a person can opt to carry forward allowable expenses incurred in Singapore in the year to derive foreign income but which is not remitted to Singapore in that same year. These expenses can be deducted in subsequent years when the foreign income is remitted to Singapore.

In this updated edition, the example in paragraph 3 was enhanced and moved to the Annex of the e-Tax Guide.

This e-Tax Guide replaces the IRAS’s e-Tax Guide on “Liberalised treatment of expenses incurred in Singapore to derive foreign income” published on 22 January 1996.

For full details, please refer the e-Tax Guide on the IRAS website.

Source: This article was extracted from the Inland Revenue Authority of Singapore’s (IRAS) website. Visit http://www.iras.gov.sg/ for more information.