Singapore – Extension of Time to File Tax Clearance for Frequent Business Travellers

Singapore – Extension of Time to File Tax Clearan...

To help alleviate the practical difficulties experienced by employers, Singapore’s tax authority has advised it is prepared to grant an extension of time to file Forms IR21 of Frequent Business Traveller (FBT) employees who exceeded 60 days of business stay in Singapore in a calendar year.

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To help alleviate the practical difficulties experienced by employers, Singapore’s tax authority, the IRAS, has advised it is prepared to grant an extension of time to file Forms IR21 of Frequent Business Traveller (FBT) employees who exceeded 60 days of business stay in Singapore in a calendar year.1

Why This Matters

The extension of time to file should bring welcome relief for employers. However, they will still need to track and monitor the business travel of their FBT employees so as to ascertain their tax treatment and related compliance obligations with respect to employers’ filings of Form IR21, etc.

Employer’s Tax Filing Obligations for FBT Who Exceeded 60 Days

We have summarized the new guidelines in the table below:

Category of FBT Employee Period of Extension Allowed
FBT with work pass*** Up to 2 months from the date of cancellation or expiry of the work pass, whichever is earlier.
FBT without work pass and it is certain that the FBT will no longer visit Singapore for the remainder of the year Up to 2 months from the date of the FBT's last business visit to Singapore.
FBT employee without work pass but it is not certain the FBT employee will not visit Singapore for the remainder of the year Until 31 March of the following year. The employer must complete its annual review of the business visits of the FBT by 31 January of the following year.

 

***includes an Employment Pass (for professionals), S Pass (for mid-level skilled workers) and Work Permit (for semi-skilled or unskilled workers). - See more at:http://www.mom.gov.sg/foreign-manpower/passes-visas/Pages/default.aspx#sthash.uI7A2OUZ.dpuf

Under Singapore law, the FBT foreign employee is exempt from tax on income attributable to business trips to Singapore if visiting Singapore for not more than 60 days in a year. All business travel during the year must be aggregated for counting under the 60-day exemption rule.

Where the 60-day threshold is breached, the FBT employee is subject to tax in Singapore under domestic law unless relief is available under a double tax agreement. The employer has the onus to file and seek tax clearance with the IRAS.

To learn more about the tax clearance process and Form IR21 obligations, as well as the new concessions regarding Form IR21 compliance – in cases where FBT employees exceed 60 days of business stay in Singapore – see the following newsletter prepared by the KPMG International member firm in Singapore, “Extension of Time to File Tax Clearance for Frequent Business Traveller” in Tax Alert(Issue 25, December 2014).

Footnote

1 The Inland Revenue Authority of Singapore (IRAS) recently informed KPMG of new guidelines to simplify the tax reporting for FBTs into Singapore via email on 18 November 2014. 

For further information or assistance, please contact your local GMS or People Services professional or one of the following professionals with the KPMG International member firm in Singapore:

BJ Ooi, Partner, Head of GMS (tel. +65 6213 2657; e-mail: boonjinooi@kpmg.com.sg)

Dennis McEvoy, Partner (tel. +65 6213 2645; e-mail: dennismcevoy@kpmg.com.sg) 

The information contained in this newsletter was submitted by the KPMG International member firm in Singapore. The information contained herein is of a general nature and based on authorities that are subject to change. Applicability of the information to specific situations should be determined through consultation with your tax adviser.

© 2016 KPMG Tax Services Pte Ltd., a Singapore corporation and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved.

Flash Alert is an Global Mobility Services publication of KPMG LLPs Washington National Tax practice. The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.

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