GST is a tax on goods and services purchased or consumed locally. Here is a quick overview of GST and how it affects your business

• Goods and Services Tax (GST) is a tax charged on the supply of goods and services made in Singapore and on the importation of goods into Singapore 
• The current rate is 5% (from 1 January 2004). The rate will be increased to 7% from 1 July 2007.

Goods and services are subject to GST as the following:

• All goods and services are taxable and known as taxable supplies
• However, some items are specifically exempt from GST by law. Exempted items include financial services and the sale or lease of residential properties

Necessity of Registration

• Your business must be registered to collect GST if your annual turnover exceeds or is likely to exceed S$1 million from the sale of taxable goods and services
• This requirement may be waived if most of your goods or services are exported or supplied internationally ("zero-rated supplies")

Choose to Registration

• You may also apply to the Comptroller of GST to collect GST voluntarily. Approval for voluntary registration is at the discretion of the Comptroller
• Once approval is given, you must remain registered for at least two years

Purpose of Registration

• Most businesses register for GST to claim back the GST incurred on their business purchases
• When GST paid exceeds GST collected, the difference can be claimed from IRAS as a GST refund
• When GST collected exceeds GST paid, you have to pay the difference to IRAS
• When GST rate increase, it may make business sense to voluntarily register to collect GST in order to claim back GST incurred on business purchases

Eligible Persons for Registration

• Sole proprietorships
• Partnerships
• Limited liability partnerships
• Companies
• Clubs, associations, management corporations or organizations
• Non-profit organizations
• Statutory boards
• Government bodies

GST Schemes To Help Businesses

To create a pro-enterprise environment, the Government has several assistance schemes relating to GST. These schemes generally help to ease the cash flow for businesses

Goods and Services Tax (GST) Assistance Scheme

Get a grant to lower the costs involved in becoming a GST-registered trader. GST traders can collect GST and claim back for GST paid to suppliers

Major Exporter Scheme (MES)

Major exporters can improve their cash flow by deferring GST payments on goods imported mainly for re-export out of Singapore

Licensed Warehouse Scheme

Transform your warehouse into a licensed warehouse for storing dutiable goods. In licensed warehouses, duty and Goods and Services Tax (GST) are suspended until the goods are released for sale into Singapore

Zero GST Warehouse Scheme (ZGS)

Businesses can transform their warehouses into zero-GST warehouses to minimise red tape and bypass the Goods and Services Tax (GST) process