Introduction to GST (or VAT) in Singapore

What is GST (or VAT)?

GST stands for Goods and Services Tax or GST (commonly known in other countries as VAT) , is a consumption tax applied to all products and services in Singapore, including the importing of goods into Singapore. It is similar to Value Added Tax (VAT), which is charged in other countries. The Singapore GST rate was previously 7% but recently changed to 8%.

Who Should Register for GST?

  • As a business, you must register for GST when your value of supplies (sales or revenue) exceeds or is expected to exceed S$1 million.
  • Company below the threshold ($1 million) can also voluntarily register for GST.
Zero-rated supplies (0% GST):
If your supply of services qualifies as international services (eg. services supplied directly in connection with office situated outside Singapore) you do not need to account for GST.

Responsibilities if you are GST registered

  • Charge and account for GST on Standard-Rated Supplies
  • E-File GST Returns and Pay Tax Due (even if you have no transactions, you still need to file a ‘NIL’ GST return)
  • Keep proper business and accounting records
  • Display prices with GST
  • Issue Tax Invoices with GST Registration Numbers (if under $1,000 you can issue a simplified tax invoice)
  • Inform IRAS of any company changes within 30 days (eg. change in registered address or ownership)
  • Cancellation of GST registration (you have to charge GST and submit returns until the last day of the GST registration, which is one day before the effective date of cancellation)
You can check this article on how to file a GST return.

How to calculate the GST?

The difference between output tax and input tax is the net GST payable to IRAS or net GST refundable by IRAS.

  • GST Input tax: This is the GST expense that you incur on business purchases and expenses (including import of goods).
  • GST Output tax: This is the GST that you must charge on your sales or services at the prevailing rate.

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