Singapore income tax changes accounting standard 115 | KPMG | GLOBAL

Singapore: Income tax implications, adoption of accounting standard FRS 115

Income tax in Singapore

For Singapore income tax purposes, income is subject to tax if it is sourced in Singapore or if foreign-sourced income is received or deemed to be received in Singapore (unless specifically exempted by the tax law). Also, the determination as to whether income is subject to tax is based on the “entitlement to income” principle.


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From the perspective of the Inland Revenue Authority of Singapore, aligning this tax treatment of income with the treatment under accounting standard FRS 115, Revenue from Contracts with Customers, may represent a move away from the “entitlement to income” principle because revenue would now be recognized when the taxpayer / entity has performed its obligations (even if it might not be entitled to the income yet).

The tax authority issued a public consultation paper to aid in making a decision as to whether or not the tax rules need to be revised to align with the FRS 115 accounting treatments.


Read a February 2016 report prepared by the KPMG member firm in Singapore: Income Tax Implications Arising from the Adoption of FRS 115 Revenue from Contracts with Customers

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