On or about 5 August 2019, the Inland Revenue Authority of Singapore (IRAS) has updated its website content on the application for certificates of residence (CORs).
Foreign-owned investment-holding companies with purely passive sources of income and receiving only foreign-sourced income are not eligible to apply for COR. A foreign-owned company is a company where 50% or more of its shares are held by:
- Foreign companies which are incorporated outside Singapore; or
- Individual shareholders who are not citizens of Singapore.
- The ownership is to be applied at the ultimate holding company level.
The ownership is to be applied at the ultimate holding company level.
However, IRAS may still issue a COR if these companies are able to satisfy IRAS that:
- The control and management of the company’s business is exercised in Singapore; and
- The company has valid reasons for setting up an office in Singapore.
To satisfy the IRAS of the conditions listed above, such companies must demonstrate that decisions on strategic matters are made in Singapore, e.g. by showing the IRAS that their Board of Directors’ meetings are held in Singapore. Besides this, the company must also:
- Have related companies in Singapore that are tax residents of Singapore or have business activities in Singapore; or
- Receive support or administrative services from a related company in Singapore; or
- Have at least 1 director based in Singapore who holds an executive position and is not a nominee director; or
- Have at least one key employee (e.g. CEO, CFO, COO) based in Singapore.
Source: IRAS website, 5 August 2019.