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Our company wants to expand its online business to Singapore, but we don’t quite understand when the goods and services tax will apply. Because we have never done business in Singapore, we only have projections to help us determine whether we will exceed the registration requirement threshold. How should we determine whether or not to register for the goods and services tax?
The Goods and Services Tax (GST) applies to goods and services sold in Singapore and to all goods imported into Singapore. You are required to register your business if your taxable turnover exceeds S$1 million during the previous 12 months or if you expect your taxable turnover for the next 12 months to exceed S$1 million. The GST applies to all imported goods, regardless of whether or not your company is registered. If you have an online business that is not established in Singapore, your sales to Singaporeans will likely be considered imports. In that case, you will need to acquire the appropriate import permit(s) and will be required to pay GST upon importation of the goods. If you have a Singaporean established business, you can use your projections to help you determine whether you will exceed the registration requirement threshold. Because of the complex nature of taxes, we suggest you speak with an attorney about how the GST will apply to your business.