On 1 December 2022, the Inland Revenue Authority of Singapore (IRAS) published an updated e-Tax Guide, Income Tax: Tax Exemption under Section 13(12) for Specified Scenarios, Real Estate Investment Trusts and Qualifying Offshore Infrastructure Project/Asset (Ninth Edition). The e-Tax Guide explains the scenarios and conditions under which the tax exemption under section 13(12) of the Income Tax Act (ITA) may be granted to resident taxpayers with effect from 31 May 2006. Subject to certain conditions, the exemption is available on:
- Certain foreign-sourced income received in Singapore by resident companies under the scenarios specified in the e-Tax guide;
- Certain foreign-sourced income received in Singapore by the trustees of Real Estate Investment Trusts listed on SGX (S-REITs), S-REITs' wholly-owned (directly or indirectly) by Singapore incorporated and resident companies, or S-REITs' wholly-owned Singapore sub-trusts;
- Certain foreign-sourced income received in Singapore by listed resident entities or their wholly-owned Singapore resident subsidiary companies from qualifying offshore infrastructure projects/assets; and
- Foreign-sourced income received in Singapore by resident taxpayers on a case-by-case basis.
The updates in the latest edition of the e-Tax guide concern changes that are generally effective from the year of assessment 2024. This includes the inclusion of wholly-owned Singapore incorporated and resident companies held indirectly by an S-REIT and wholly-owned sub-trusts held directly by an S-REIT, as well as the expansion of scenarios and amendments to existing scenarios currently covered. Further, it is provided that if a taxpayer misses the deadline, IRAS is prepared to review the declaration form, subject to certain mitigating factors (currently not accepted). Lastly, the extension of the tax exemption scheme for qualifying income originating from qualifying offshore infrastructure projects/assets is updated, including that the exemption scheme expires on 31 December 2025.