Monday, April 02, 2012

IRAS to simplify tax filing for small companies

SINGAPORE: The Inland Revenue Authority of Singapore (IRAS) is simplifying tax filing for small companies to help them reduce compliance costs and increase their overall productivity.

IRAS says currently, all companies have to report their Estimated Chargeable Income (ECI) within three months of the end of their financial year end.

Companies without any taxable profit and have no ECI are also required to do so.

Going forward, IRAS says small companies with turnover not exceeding S$1 million and with no ECI will no longer need to file the ECI.

The waiver will take effect from Year of Assessment 2013 for companies with accounting year ending October 2012 or after.

IRAS adds that this waiver will benefit 67,000 companies, or about 42 per cent of all companies with an annual turnover of under S$1 million.

Mr Moses Lee, commissioner of IRAS said: "We recognise that small companies face greater challenges in managing their tax obligations. Their resources are already highly stretched, as they struggle just to keep up with their day-to-day operations and focus on business viability."

Mr Lee says IRAS has set a threshold of S$1 million turnover to manage the revenue-at-risk, so that larger companies will continue to report their ECI and pay their taxes within the current time-frame.

In addition, IRAS will also introduce a new simplified income tax form, known as the Form C-S.

Form C-S is a shortened three-page form that includes only the essential tax and financial information most relevant to small companies.

IRAS says it will take about 10 minutes to complete Form C-S, or half the average time taken to complete Form C, a seven-page form which small companies fill out currently.

The introduction of Form C-S will help 110,000 small companies or 70 per cent of all companies with an annual turnover not exceeding S$1 million.

IRAS says this will take effect from Year of Assessment 2012.

- CNA/ck

View the original article here

Source From Channel News Asia

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