Supplies made in Singapore and importation of goods:
GST, or Goods and Services Tax, is a 9% tax applied in Singapore. It’s charged on:Goods and services sold by a taxable business in Singapore.
Goods imported into Singapore. In short, it’s a 9% tax on most business transactions and imports in Singapore.
The only exemptions from GST are prescribed financial services, the sale or rental of residential properties, the sale of digital payment tokens, and the import and local supply of prescribed investment precious metals.
Zero-rating only applies to the export of goods and international services (subject to certain conditions).
Import reliefs (e.g. Major Exporter Scheme, Approved Contract Manufacturer and Trader Scheme) are available to ease the cash-flow burden of GST-registered businesses.
GST registration is required if a business makes taxable supplies in excess of SGD 1 million for a 12-month period. Voluntary registration is permitted if the taxable supplies are below the registration threshold, subject to conditions.
A business may claim input tax credits on its purchases and expenses after its GST registration, subject to satisfying the prescribed input tax conditions.
Overseas Vendor Registration Regime:
The Overseas Vendor Registration regime brings to tax business-to-consumer (B2C) supplies of remote services (i.e. digital services and non-digital services) and imported low-value goods. There are specific definitions for remote services and imported low-value goods.
Under the Overseas Vendor Registration regime, suppliers belonging outside Singapore are required to register, charge, and account for GST on supplies of remote services and imported low-value goods supplied to non-GST registered customers in Singapore.
Under certain conditions, local and overseas operators of electronic marketplaces may also be regarded as the supplier of the supplies made by the overseas suppliers through these marketplaces.
Overseas suppliers that supply imported low-value goods and remote services to Singapore non-GST-registered customers in excess of SGD 100,000 in a 12-month period and have a global annual turnover of at least SGD 1 million are required to register for GST in Singapore.
Reverse Charge: Reverse charge is a rule for certain local businesses in Singapore that can’t fully claim input tax because they make exempt supplies (like certain financial services) or do non-business activities.
If these businesses are GST-registered, they must:
Self-calculate and pay GST on imported services they buy from overseas providers and on imported low-value goods.
They can then claim this GST back as input tax, but only if they meet the usual input tax recovery rules.
In simple terms, these businesses have to handle GST themselves for specific overseas purchases and can reclaim it under normal conditions.
If these businesses are not registered for GST, they would be liable for GST registration under the reverse charge rules if their purchase of in-scope services and imported low-value goods exceeds SGD 1 million in a 12-month period.