SINGAPORE TAXATION GUIDE

Corporate Tax: 0 - 17% max

Tax System: Single- er corporate income tax system Taxa on on dividends: NONE Capital gains tax: NONE Estate duty: NONE Foreign-sourced income: Tax-exempt

SINGAPORE CORPORATE TAX

New Startup Companies* for First 3 Years of Assessment

8.50% 17.00%

* Qualifying condi ons: No more than 20 individual shareholders throughout basis period for that YA All of whom are individuals benecially and directly holding the shares in their names; OR Where there are non-individual shareholders, at least 1 shareholder is an individual holding at least 10% of the shares.

Taxable income

NO TAX

First S$100,000

S$100,001 - S$300,000

Above S$ 300,000

For All Other Companies - Par al Tax Exemp on

4.25% Taxable income 8.50% 17.00%

Companies that do not meet the qualifying condi ons would s ll be eligible for par al tax exemp on.

First S$10,000

S$10,001 - S$300,000

Above S$ 300,000

TAX-FREE DIVIDEND Tax paid by a company on its chargeable income is the nal tax and all dividends paid to its shareholders are exempt from further taxa on.

0%

Singapore Corporate Tax

Copyright 2011 Rikvin Pte Ltd

NEW STARTUP COMPANIES FOR FIRST THREE YEARS OF ASSESSMENT

Chargeable Income ($) 100,000 200,000 300,000 400,000 500,000 600,000 700,000 800,000 900,000 1,000,000 5,000,000 10,000,000 Es mated Tax (S$) 0 8,500 17,000 34,000 51,000 68,000 85,000 102,000 119,000 136,000 816,000 1,666,000 Eec ve tax rate 0% 4.25% 5.67% 8.50% 10.20% 11.33% 12.14% 12.75% 13.22% 13.60% 16.32% 16.66%

ALL OTHER COMPANIES PARTIAL TAX EXEMPTION

Chargeable Income ($) 100,000 200,000 300,000 400,000 500,000 600,000 700,000 800,000 900,000 1,000,000 5,000,000 10,000,000 Es mated Tax (S$) 8,075 16,575 25,075 42,075 59,075 76,075 93,075 110,075 127,075 144,075 824,075 1,674,075 Eec ve tax rate 8.08% 8.29% 8.36% 10.52% 11.82% 12.68% 13.30% 13.76% 14.12% 14.41% 16.48% 16.74%

Singapore Corporate Tax

Copyright 2011 Rikvin Pte Ltd

PRODUCTIVITY AND INNOVATION SCHEME

The Produc vity and Innova on Credit (PIC) Scheme has been further enhanced for Singapore Budget 2011. It is a scheme to provide tax incen ves so as to encourage businesses to invest and upgrade along the innova on value chain. The table below outlines the benets of PIC:

Before PIC: Currently, businesses can typically deduct their expenses at cost i.e. 100% as part of the general tax regime. Tax savings = S$100,000 x 17%

S$100,000

S$100,000

S$100,000

S$400,000

S$17,000

S$68,000

A er PIC: Businesses can now enjoy 400% deduc on on the cost of the same expenditure. Tax savings = S$400,000 x 17%

Expenditure

Deduc ons

TAX SAVINGS

Qualifying ac vi es Acquisi on or Leasing of Prescribed Automa on Equipment Training Expenditure

Brief descrip on of qualifying expenditures under the PIC Costs incurred to acquire/lease prescribed automa on equipment Costs incurred on: In-house training (i.e. Singapore Workforce Development Agency (WDA) cer ed, Ins tute of Technical Educa on (ITE) cer ed; or All external training. Costs incurred to acquire IPRs for use in a trade or business (exclude EDB approved IPRs and IPRs rela ng to media and digital entertainment contents) Costs incurred to register patents, trademarks, designs and plant variety Costs incurred to create new products and industrial designs where the ac vi es are primarily done in Singapore Costs incurred on sta, costs and consumables for qualifying R&D ac vi es carried out in Singapore or overseas, if the R&D done overseas is related to the taxpayers Singapore trade or business

Total deduc ons/allowances under the PIC (as a % of qualifying expenditure)

Acquisi on of Intellectual Property Rights (IPRs)

400% allowance or deduc on for qualifying expenditure subject to the expenditure cap, 100% allowance or deduc on for the balance expenditure exceeding the cap

Registra on of Intellectual Property Rights (IPRs) Design Expenditure

Research & Development (R&D)

400% tax deduc on for qualifying expenditure subject to the expenditure cap*. For qualifying expenditure exceeding the cap for R&D done in Singapore, deduc on will be 150%. For balance of all other expenses, including expenses for R&D done overseas, deduc on will be 100%

Notes: Total expenditure cap for YA 2011 and YA 2012 - $800,000 for each of the six qualifying ac vi es. Total expenditure cap for YA 2013 to YA 2015 - $1,200,000 for each of the six qualifying ac vi es.

Singapore Produc vity and Innova on Scheme

Copyright 2011 Rikvin Pte Ltd

CAPITAL GAINS TAX

Gains that are of a capital nature are not taxed in Singapore. However, where there is a series of transac ons or where the holding period of an asset is rela vely short, IRAS may take the view that a business is being carried on and a empt to assess the gains as trading prots of the company.

WITHHOLDING TAX ON PAYMENTS TO NON RESIDENTS

Since a non-resident is liable to pay income tax on Singapore-sourced income, any person making payment of a specied nature to a non-resident has to withhold a certain percentage of that payment as Withholding taxes.

Dividends Interest Royal es Company directors renumera on Technical assistance and service fees Rent on moveable property Management fees Charter fees for ship or aircra

Exempt 15% 10% 20% 17% 15% 17% 0 - 2%

Copyright 2011 Rikvin Pte Ltd

PERSONAL TAX

Income Tax Rate for Non-Resident Individuals

YEAR OF ASSESSMENT: CURRENT Income Range 0 20,000 20,001 30,000 30,001 40,000 40,001 80,000 80,001 160,000 160,001 320,000 Above 320,000 Rate (%) 0.0 3.5 5.5 8.5 14.0 17.0 20.0 YEAR OF ASSESSMENT: 2012 (NEW) Income Range 0 20,000 20,001 30,000 30,001 40,000 40,001 80,000 80,001 120,000 120,001 160,000 160,001 200,000 200,001 320,000 Above 320,000 Rate (%) 0.0 2.0 3.5 7.0 11.5 15.0 17.0 18.0 20.0

Note: A one-o personal income tax rebate of 20%, capped at $2,000, will be granted for the Year of Assessment 2011.

Income Tax Rate for Non-Resident Individuals

Type of Income Directors remunera on & fees Entertainers professional income Other professional income Employees remunera on (Where the tax calculated on residents rates is higher, the resident rates are used) Short-term employees remunera on (Not more than 60 days) Other income (Where not specically exempt) Rate (%) 20 15 15 15 Nil 20

Singapore Personal Tax

Copyright 2011 Rikvin Pte Ltd

PERSONAL INCOME TAX RELIEFS

YEAR OF ASSESSMENT 2010($) YEAR OF ASSESSMENT 2011($) YEAR OF ASSESSMENT 2012($) NEW

Earned income reliefs

- Under age 55 - 55 to age 59 - Age 60 and above To qualify, working spouse must not earn more than $2,000 in 2010, $4,000 in 2011/2012 - Living with the taxpayer in the same household (each parent) - Not living with the taxpayer in the same household (each parent) - By self or employer to selfs account - By self to spouse, sibling, parents and grandparents account - Without foreign domes c worker concession - With foreign domes c worker concession

1,000 3,000 4,000 2,000

1,000 3,000 4,000 2,000

1,000 3,000 4,000 2,000

Spouse relief

Child relief Dependent parents relief

4,000 7,000 4,500 3,500 Up to 7,000 Up to 7,000 Up to 6,360 Up to 4,080 3,000 - Inac ve NSman in previous year (non-key appointment holder) - Ac ve NSman in previous year (non-key appointment holder) - Inac ve in NSman in previous year (key appointment holder) - Ac ve in NSman in previous year (key appointment holder) - Age 50 & below - Age 51 to 55 - Age 56 to 60 - Age 61 to 65 - Above 65 - Singaporean / Singapore Permanent Resident - Foreigner 1,500 3,000 3,500 5,000 Up to 15,300 Up to 13,770 Up to 9,563 Up to 5,738 Up to 3,835 Up to 11,475 Up to 26,775

4,000 7,000 4,500 5,500 Up to 7,000 Up to 7,000 Up to 6,360 Up to 4,080 3,000 1,500 3,000 3,500 5,000 Up to 15,300 Up to 13,770 Up to 9,563 Up to 5,738 Up to 3,835 Up to 11,475 Up to 26,775

4,000 7,000 4,500 5,500 Up to 7,000 Up to 7,000 Up to 6,360 Up to 4,080 3,000 1,500 3,000 3,500 5,000 Up to 16,200 Up to 14,580 Up to 10,125 Up to 6,075 Up to 4,050 Up to 12,750 Up to 29,750

Course fee relief CPF cash top-up relief

Foreign maid levy (applicable only to working mothers) Grandparent caregiver relief NSman (self/wife/parent) relief

CPF relief

Supplementary Re rement Scheme (SRS) relief

Singapore Personal Tax

Copyright 2011 Rikvin Pte Ltd

RIKVIN PTE LTD

20 Cecil Street, #14-01, Equity Plaza, Singapore 049705 Main Line : (+65) 6438 8887 Fax : (+65) 6438 2436 Email : info@rikvin.com Website : www.rikvin.com

This material has been prepared by Rikvin for the exclusive use of the party to whom Rikvin delivers this material. This material is for informa onal purposes only and has no regard to the specic investment objec ves, nancial situa on or par cular needs of any specic recipient. Where the source of informa on is obtained from third par es, Rikvin is not responsible for and does not accept any liability over the content.

Company Registra on | Immigra on | Accoun ng | Taxa on | Oshore

Copyright 2011 Rikvin Pte Ltd