Once any company in Singapore gets GST (Goods and Services Tax) registered, then the company can charge and collect GST at the prevailing rate. The prevailing rate of GST as of the current year from August is at the rate of 7%.
Besides that, a few procedures for documentation submission also need to be followed. Any business that is GST-registered will have to submit all the necessary documents to the website of the IRAS at the end of every quarter.
Whatever GST that any business will charge and collect will be on the behalf of IRAS and will be known as output tax. Hence, it has to be submitted back to IRAS quarterly. GST incurred on various business-related transactions and expenses, on the other hand, are called input tax, which is unlike output tax, are claimed if all the conditions for claiming will be met.
Find a professional firm that can offer you all kind of help and support in your yearly GST filing and also offers any other type of accounting services too.
What is GST?
It is a type of tax that applies to both goods and services. GST is considered as an integrated tax, which is included in the price of products and services in Singapore for customers. Singapore’s GST is now fixed at a flat rate of 7 percent regardless of your nature of the goods or services offered.
GST-registered firms receive GST on account of the IRAS by adding it in the pricing of their products and services, and afterwards claim GST credits on the products and services they purchase at a business cost. Non-GST-registered businesses will be unable to do so.
The Registration process of GST in Singapore
Once your business has been GST-registered, you must collect and charge GST at the present rate. The current GST rates are set at 7% as of August 2021. Procedures for submitting documentation must also be followed. On a quarterly basis, a GST-registered business must submit documentation to the IRAS website.
This output tax, which you will charge and collect on behalf of IRAS, is also known as GST. This means, it must be returned to IRAS after every quarter.
Input tax, on the other hand is GST paid on business-related expenses and transactions. In contrast to output tax, input tax is claimed if certain conditions are met.
Why will I need any GST filing services?
Even though GST has been in effect in Singapore for nearly two decades, most businesses still find it very difficult to comply with its regulations and requirements. With the (IRAS) conducting more audits and the GST rate expected to rise in the next years, so your GST compliance must be addressed.
Jazcorp can offer you a team of GST specialist that can offer you with practical and timely support with your day-to-day GST activities and help you take a proactive approach to manage your GST risks.
Those businesses whose turnover has reached more than $1 million/annum must register them for GST. Any business that is GST-registered will have plenty of responsibilities that include the following:
- GST claims and charges
- GST accounting and filing
- Proper record-keeping
You must ensure that entire GST returns will be filed by you correctly and comprehensively. If you are not too sure about how to file then you may consult any tax professional so that you can avoid incurring any costly penalties, which can be in tune of 200% of your tax.
How GST works in Singapore?
GST-registered Singapore businesses must charge GST at the present rate on their supply and services. Let us suppose a customer pays S$10 on your product or service. When a 7% GST is applied, the final cost will be S$10.70 – this is referred to as the output tax.
GST that a business charges and collects from their customers must be remitted to IRAS through GST filing.
The amount of GST paid by a business because of your purchases and expenses made in order to operate is known as input tax. The GST tax is reimbursed to you once the input tax is subtracted from the output tax.
How can you know whether you are required for GST registration?
Entrepreneurs can decide whether their business has to register for GST on their own. Mandatory registration and voluntary registration are the two types of GST registration. It is simple to figure out whether or not your business has to register for GST.
You must register for GST in case your previous year’s taxable revenue was more than at least 1 million dollars, or if you are expecting taxable sales that are more than 1 million dollars in the coming year.
However, if your turnover is below a million dollars, then you may register voluntarily. Any businesses that wish to apply for GST are eligible for claiming input tax in buying and expenses of your business.