Singapore Double Tax Agreements (DTA)

Singapore has an extensive network of almost 100 double tax treaties including the following countries:-

  • Australia
  • China
  • India
  • Indonesia
  • Malaysia
  • Spain
  • United Kingdom
  • United States
  • …many more countries

Some of these treaties are comprehensive treaties, whilst a few are in the nature of limited agreements or exchange of information agreements.

How does double tax relief work?

Foreign income that is received in Singapore may be taxed.

You may have also already paid tax on that foreign income. When your company earns foreign income from a foreign country that is a tax-treaty partner, you may wish to claim the benefits under the DTA that entitles your company to either (a) not pay tax in the foreign jurisdiction or (b) to pay tax at a reduced rate in that foreign jurisdiction. In the latter case, you would have paid some tax in the foreign jurisdiction and hence would be paying tax twice.

Double Tax Relief provides relief under a relevant Avoidance of Double Taxation Agreement (DTA), by making available a tax credit. This effectively reduced double taxation. A Singapore tax resident company may claim a credit for the amount of tax paid in the foreign jurisdiction, and for that credit to be applied against Singapore tax that is payable on that same income.

There are various conditions for claiming the foreign tax credit.

If you would like to find out more, speak to our consultants.

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