Tax Filing for Chargeable

Income (CI) in Singapore

Made Easy

The formula for calculating chargeable income in Singapore is:
Chargeable income = Assessable income - Allowable deductions

The corporate income tax rate in Singapore is a flat rate of 17%. So, if a company has an assessable income of S$100,000 and has allowable deductions of S$20,000, then its chargeable income would be S$80,000. The company would then pay S$13,600 in chargeable income tax (17% of S$80,000).

The ECI is an "estimate" of the company's chargeable income for a given year, while the income reported in Form C/C-S is the actual chargeable income that the company earned in that year. Oftentimes the income reported in Form C/C-S may be higher or lower than the reported ECI, depending on the actual income and expenses incurred by the company during the Year of Assessment (YA). Furthermore, companies with an annual revenue of less than $5 million are not required to submit ECI returns.

If you do not have any dedicated accounting and tax team, it would be beneficial for you to acquire the services of professionals like Lanturn to avoid penalties.

Failing to file your business’ Form C/C-S on time, will result in penalties, fines and enforcement actions depending on the specific circumstances. The penalties for late filing of Form C/C-S may range from a basic penalty of 10% of the unpaid tax to a maximum penalty of 50% of the unpaid tax. If a company fails to file tax returns for two years or more, the penalty may be twice the amount of tax assessed, and a fine not exceeding S$5,000.

Moreover, a composition fee capped at S$1,000 may be imposed by the IRAS. It is important for companies to file their tax returns on time and accurately to avoid any penalties or legal actions. If you feel that your accounting team would require the assistance of experts, availing of Lanturn's services may be beneficial to you.