How to do Tax Planning in Singapore
Tax planning is such an essential part that should be prioritized as a way of managing personal finances. Despite Singapore taxation being competitive, well-regulated and with some incentives; tax planning is vital for investment and business planning. If you’re not well versed with tax planning then engaging professionals such as Onestop company secretary can be of great help.
Filing of Income Tax is a must if you’re a citizen of Singapore, a foreigner who has worked and also stayed in Singapore for about 183 days or more within a year and a permanent resident of Singapore. Engaging Onestop company secretary in proper tax planning can help the business enjoy maximum profits.
All of the income derived or earned within Singapore is viable for income tax and the sources of such income include;
- Income from property or investments
- Employment income
- Income from business, trade profession or a vocation
- Other income sources (annuities, trust income, royalties, winnings, annuities or estate income)
Here are some of the things to be considered as you do tax planning;
The tax authority body in Singapore is referred to as the Inland Revenue Authority of Singapore (IRAS). It’s the body that administers and also manages all matters tax including tax laws in Singapore. For accurate tax planning, you can consider working with an audit firm in Singapore. IRAS is responsible for the running, assessing, managing and collecting taxes from all the income sourced within Singapore. Before you get started with taxation planning, it’s advisable that you take your time to understand IRA’s rules and regulations so as to avoid situations where your business might be found guilty of tax evasion.
Singapore tax rates are quite competitive with the current income tax rate of corporate income being 17% which is considered as the lowest world over. Income tax rates are designed to be progressive for resident taxpayers and it, therefore, means that higher-income earners get to pay higher tax amounts.
Before starting any tax planning process, it’s advisable that you get insight on the applicable tax rates for the different levels of taxable income then find out the exact rate that’s ideal for your annual taxable income. Having such information will make it possible for you to get the most effective tax planning.
Tax saving plans or tax reliefs are the most important aspects of tax planning in Singapore that one should be well versed with. Businesses should look out for the best tax deduction plans or tax saving plans for employment expenses, business organizations, charitable organizations and such as.
Engage an experienced tax consultant
Tax planning can be a complex process and to ensure that everything is accurately done, engaging an experienced tax consultant can be of great help. By engaging a professional tax consultant, you will be assured of getting the best tax minimization plan as you use an approach that’s acceptable. The tax consultant will ensure you don’t evade paying tax while also considering effective planning for tax saving.
A professional tax consultant is also well versed with IRA’s regulations, tax relief plans, tax rates and will be able to execute the best tax saving plan that suits you.