On or about 15 January 2019, the Inland Revenue Authority of Singapore (IRAS) has published the third edition of e-Tax Guide: Tax Deduction for Borrowing Costs Other Than Interest Expenses. It replaces the second edition which was published on 18 August 2014.
This e-Tax Guide aimed to provide the scope of tax deduction for borrowing costs (other than interest expenses) which are incurred as a substitute for interest expense or to reduce interest costs and details of such borrowing costs that will be granted tax deduction.
The following updates and amendments have been made:
- Paragraphs 4.3 to 4.6 have been updated to provide greater clarity on how deduction for front-end fees should be claimed.
- Paragraph 4.3 has been updated as the administrative concession has been removed and replaced with the tax treatment for interest expense incurred on loans to re-finance earlier loans or borrowings.
- Paragraphs 4.4 to 4.6 have been added to provide details on the documents that taxpayers should maintain in order to support their claim for such deductions.
- Footnotes 2 and 3 have been updated with references to the new provisions and e-Tax Guide relating to FRS 109.
Source: IRAS, 15 January 2019