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Note: You may download the summary tables,
as well as other relevant documents here.
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| 1 |
Reduction
in
Personal
Income
Tax
(PIT)
rates |
The
top
PIT
rate
will
be
reduced
to
21%
for
the
year
of
assessment
(YA)
2006,
and
then
to
20%
for
YA2007.
The
marginal
tax
rates
of
the
other
income
brackets
will
also
be
correspondingly
reduced. |
Second Schedule
Part
A
[Clause
45]
|
Clause
45
amends
Part
A
of
the
Second
Schedule
to
provide
for
the
tax
rates
applicable
to
a
resident
individual
or
a
Hindu
joint
family
for
YA
2006. |
| 2 |
Introduction
of
carry-back
of
capital
allowances
(CAs)
and
trade
losses
|
With
effect
from
YA
2006,
the
unutilised
CAs
and
trade
losses
of
any
person
will,
subject
to
conditions,
be
allowed
to
be
carried
back
for
set-off
against
assessable
income
of
the
person
for
the
YA
immediately
preceding
the
YA
relating
to
the
basis
period
in
which
the
CA
was
granted
or
trade
loss
was
incurred.
In
certain
cases,
the
set
off
may
be
granted
against
the
spouse’s
assessable
income
for
the
immediate
preceding
YA.
Further
details
will
be
released
in
an
IRAS
circular
by
June
05.
|
Sections
2, 10D(2), 10H(1), 23(3), 36A(4),
36A(10), 37(5), 37E & 37F
[Clauses
2(b),
5,
6,
18(a),
20,
22(c)&
26]
|
Clause
26
inserts
new
sections
37E
and
37F.
The
new
section
37E
provides
for
a
one-year
carry-back
of
current
year
unutilised
CAs
and
trade
losses,
subject
to
among
other
conditions,
a
cap
of
$100,000.
The
new
section
37F
provides
for
carry-back
of
current
year
unutilised
CAs
and
trade
losses
between
spouses
in
certain
cases.
Clause
2(b)
makes
a
consequential
amendment
to
the
definition
of
“earned
income”
in
Section
2
arising
from
the
insertion
of
new
sections
37E
and
37F
by
clause
26.
Clauses
5
and
6
amend
Sections
10D(2)
and
10H(1),
respectively,
arising
from
the
insertion
of
new
section
37F
by
clause
26
to
clarify
that
certain
allowances
and
losses
under
those
sections
are
not
to
be
transferred
between
spouses
under
section
37F.
Clause
18(a)
makes
a
consequential
amendment
to
Section
23(3)
arising
from
the
insertion
of
new
sections
37E
and
37F
by
clause
26.
Clause
20
makes
consequential
amendments
to
Section
36A(4)
and
36A(10)
arising
from
the
insertion
of
new
sections
37E
and
37F
by
clause
26.
Clause
22(c)
makes
a
consequential
amendment
to
Section
37(5)
arising
from
the
insertion
of
new
sections
37E
and
37F
by
clause
26.
|
| 3 |
Provision
for
a
reduced
rate
of
tax
on
gross
amount
of
distribution
by
Real
Estate
Investment
Trust
(REIT)
to
foreign
non-individual
unitholders
&
provision
for
deduction
of
tax
at
the
appropriate
rate
from
gross
amount
of
REIT
distribution
|
To
attract
foreign
non-individual
investors
to
participate
in
our
REITs
market,
the
tax
rate
on
gross
amount
of
distribution
made
during
the
period
from
18th
February
2005
to
17th
February
2010
by
a
trustee
of
REIT
offered
to
public
for
subscription
and
listed
on
Singapore
Exchange
to
qualifying
foreign
non-individuals
unitholders
is
reduced
from
20%
to
10%.
The
tax
computed
based
on
10%
of
the
gross
amount
of
distribution
is
a
final
tax.
In
addition,
tax
is
to
be
deducted
at
the
appropriate
rate
from
gross
amount
of
distribution
made
by
a
trustee
of
REIT
offered
to
public
for
subscription
and
listed
on
Singapore
Exchange
to
certain
unitholders.
|
Sections 43(3B), (10), 45G, 46(1)
& 48(5)
[Clauses
29,
37,
38
&
39]
|
Clause
29
inserts
a
new
subsection
(3B)
to
section
43
to
provide
for
a
final
rate
of
tax
of
10%
to
be
paid
on
gross
amount
of
distribution
made
during
the
period
from
18th
February
2005
to
17th
February
2010
by
a
trustee
of
REIT
to
qualifying
foreign
non-individuals.
Clause
37
inserts
a
new
section
45G
to
provide
for
tax
to
be
deducted
from
any
distribution
made
on
or
after
18th
February
2005
by
a
trustee
of
REIT
at
the
rate
of
10%
to
qualifying
foreign
non-individuals,
and
at
the
rate
specified
in
section
43(1)(a)
to
certain
other
persons
who
do
not
fall
within
a
specified
exclusion
list.
Clause
38
amends
section
46
by
inserting
a
new
paragraph
(d)
to
subsection
(1)
to
provide
that
any
tax
which
a
trustee
of
REIT
has
deducted
from
any
distribution
made
to
certain
person
under
the
new
section
45G(1)(b)
shall
be
set-off
for
collection
against
tax
charged
on
the
chargeable
income
of
that
person,
provided
that
the
distribution
from
which
the
tax
has
been
deducted
is
included
in
the
chargeable
income
of
that
person.
Clause
39
makes
a
consequential
amendment
to
section
48(5)
arising
from
the
insertion
of
new
section
43(3B)
by
clause
29.
|
| 4 |
Extension
of
existing
incentive
for
qualifying
debt
securities
(QDS)
and
tax
exemption
for
individuals
in
respect
of
locally
sourced
investment
income,
to
amount
payable
from
Islamic
debt
securities
|
To
encourage
growth
of
Islamically
structured
transactions
in
Singapore,
the
QDS
scheme
will
be
expanded
to
cover
amount
payable
from
Islamic
debt
securities.
This
will
apply
to
such
securities
which
are
QDS
issued
from
1st
January
2005
to
31st
December
2008.
With
effect
from
1st
January
2005,
the
tax
exemption
on
locally
sourced
investment
income
derived
by
individuals,
will
also
be
extended
to
include
any
amount
payable
from
Islamic
debt
securities.
The
existing
conditions
for
QDS
scheme
and
locally
sourced
investment
income
will
continue
to
apply
to
amount
payable
from
Islamic
debt
securities. |
Sections
13(1), (2B), (16), 42(6), (7), (8)
43N(1), (2), (4) & 45A(2A) & (3)
[Clauses
10(b),
(f),
(g),
(h),28(c),
(e),
(f),
(g),
34
&
36]
|
Clause
10
amends
section
13
—
(i)
to
insert
a
new
paragraph
(ab)
to
subsection
(1)
to
exempt
from
tax
amount
payable
to
certain
non-residents
from
certain
Islamic
debt
securities;
(ii)
to
insert
new
subsection
(1)(zf)
to
exempt
from
tax
amount
payable
to
certain
individuals
from
certain
Islamic
debt
securities;
(iii)
to
insert
a
new
subsection
(2B)
to
exclude
certain
amounts
payable
from
Islamic
debt
securities
from
tax
exemption
under
new
section
13(1)(ab);
(iv)
to
insert
a
new
definition
of
the
term
“Islamic
debt
securities”
arising
from
the
insertion
of
new
subsection
(1)(ab)
by
clause
10(b).
Clause
28
amends
section
42
—
(i)
to
insert
a
new
paragraph
(c)
to
subsection
(6)
to
provide
for
an
amount
payable
to
a
body
of
persons
from
Islamic
debt
securities
which
are
qualifying
debt
securities
issued
during
the
period
from
1st
January
2005
to
31st
December
2008
to
be
taxed
at
the
rate
of
10%,
subject
to
conditions
specified
under
subsection
(7);
(ii)
to
make
a
consequential
amendment
to
subsection
(7)
arising
from
the
insertion
of
paragraph
(c)
to
subsection
(6)
by
clause
28(c);
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