Here’s an overview of the annual statutory compliance requirements that apply to companies registered in Singapor
1. Filing Estimated Chargeable Income (ECI)
Within 3 months of the end of accounting period for the branch, Singapore companies are required to declare the revenue amount and estimated chargeable income by filing ECI form with Tax Authority. The revenue to be declared in the ECI form refers to a branch’s main source of income. Even if the branch estimates its chargeable income as zero, it still has to file a “NIL” ECI.
2. Preparation of Financial Accounts
Financial accounts of the branch must be prepared in accordance with the Singapore Financial Reporting Standards (FRS) and must consist of an audited statement of its assets and liabilities and its profit and loss accounts of its operations in Singapore. The FRS are the Singapore Accounting Standards and are prescribed in the Companies Act.
3. Audit of Financial Accounts
The Singapore Companies Act states that every company must get its financial statements and accounting records audited by an auditor on an annual basis unless the company meets the Singapore audit exemption requirement.
The Companies Act was amended in 2014 to update the audit exemption criteria for companies and introduced the concept of a “small company”. A company that qualifies as a small company is not required to appoint an auditor and have its accounts audited.
A company is considered to be a small company if it fulfils at least two out of the following three conditions:
- The total annual revenue of the company must not exceed S$10 million;
- The total assets of the company for the financial year end must not exceed S$10 million;
- The number of full-time employees at the end of the financial year must not exceed 50.
Besides private companies, group companies (holding and subsidiary companies) can also avail the Singapore audit exemption if they qualify as a small group per the criteria described below.
If you do not qualify as “ a small company”, you must:
- Appoint an auditor
- Have your accounts audited on an annual basis
- Annual Filing of Accounts
A Singapore branch is required to file the following with the Registrar within 60 days after the Annual General Meeting (AGM) of the parent company:
- A copy of the financial accounts of the parent company for the financial year concerned
- Documents accompanying the financial accounts filed overseas in the parent company’s jurisdiction
- A copy of the audited financial accounts of the Singapore branch office
If the parent company is not required by the law of the place of its incorporation or origin to hold an AGM and prepare financial accounts, it must still prepare and file audited financial accounts within 5 months (if listed) or 7 months (if not listed) from its last financial year end (FYE).
4. Income Tax Return Filing
The Singapore income tax system is annual in its structure and organisation. The profits of the accounting year ending in the preceding year will form the basis for assessment for the current Year of Assessment.
The statutory deadline for filing corporate income tax return is 30 November of Year of Assessment (YA). For example, if the accounting period of your branch office is April 1, 2022 – March 31, 2023, the income tax return deadline for the company will be November 30, 2023 (paper filing) or December 15, 2023 (e-filing).
Branch Office agents are responsible and accountable for complying with the annual filing requirements. Failure to comply with the statutory compliance requirements is an offence and may result in fines or prosecution.