{"id":1671,"date":"2021-02-03T11:12:40","date_gmt":"2021-02-03T03:12:40","guid":{"rendered":"http:\/\/ehluar.com\/main\/?p=1671"},"modified":"2021-04-07T11:30:39","modified_gmt":"2021-04-07T03:30:39","slug":"advance-ruling-summary-on-remittance-rules-under-s-1025","status":"publish","type":"post","link":"http:\/\/ehluar.com\/main\/2021\/02\/03\/advance-ruling-summary-on-remittance-rules-under-s-1025\/","title":{"rendered":"Advance Ruling Summary on Remittance rules under s 10(25)"},"content":{"rendered":"\n

On or about 1 Feb 2021, the Inland Revenue Authority of Singapore (IRAS) has published an Income Tax Advance Ruling Summary No. 2\/2021 with regards to “Trigger point on the remittance rules under section 10(25) of the Income Tax Act “. <\/p>\n\n\n\n

The subject was whether the use of a company (Company A)’s foreign-sourced dividend income from another company (Company B) to offset a non-trade related inter-company debt owing by Company A to Company B would trigger the remittance rules under section 10(25) of the Income Tax Act (s 10(25).<\/p>\n\n\n\n

The Arrangement<\/strong><\/p>\n\n\n\n

  1. Company B declares a dividend to Company A. Company A intends to offset the foreign-sourced dividend income receivable from Company B against the non-trade related inter-company debt payable to Company B.<\/li>
  2. There is no actual physical receipt \/ transmission \/ bringing of cash dividends from Company B to Company A in or into Singapore.<\/li>
  3. The dividends so declared by Company B to Company A arose from capital gains derived by Company B from the sale of Company D and its subsidiaries. <\/li><\/ol>\n\n\n\n

    The Ruling<\/strong><\/p>\n\n\n\n

    Company A\u2019s use of its foreign-sourced dividend income from Company B to offset the inter-company debt owing by Company A to Company B does not trigger the remittance rules under section 10(25) of the SITA to the extent that:<\/p>\n\n\n\n

    1. Company A\u2019s activities remain as investment-holding company as represented;<\/li>
    2. The dividends declared by Company B indeed constitutes foreign-sourced income of Company A for Singapore income tax purposes;<\/li>
    3. The foreign-sourced dividends from Company B are not remitted to, transmitted or brought into Singapore from the time the foreign-sourced dividends accrues to Company A to the time the inter-company debt is repaid to Company B. <\/li><\/ol>\n\n\n\n

      The reasons for the ruling was that Company A does not carry on any trade or business in Singapore (but as a passive investment holding company), as such, s 10(25)(b) does not apply to such a passive investment holding company; and that Company A\u2019s proposed use of unremitted foreign-sourced dividend income to offset the non-trade related inter-company debt payable does not come within the provisions of section 10(25) of the Act.<\/p>\n\n\n\n

      For more information about the ruling, please go to the IRAS website.<\/p>\n\n\n\n

      Source: IRAS<\/em>, 3 Feb 2021 <\/p>\n","protected":false},"excerpt":{"rendered":"

      On or about 1 Feb 2021, the Inland Revenue Authority of Singapore (IRAS) has published an Income Tax Advance Ruling Summary No. 2\/2021 with regards to “Trigger point on the remittance rules under section 10(25) of the Income Tax Act “. The subject was whether the use of a company (Company A)’s foreign-sourced dividend income […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"nf_dc_page":"","_et_pb_use_builder":"off","_et_pb_old_content":"","_et_gb_content_width":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[8,6],"tags":[],"class_list":["post-1671","post","type-post","status-publish","format-standard","hentry","category-incometax","category-techupdates"],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/posts\/1671","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/comments?post=1671"}],"version-history":[{"count":1,"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/posts\/1671\/revisions"}],"predecessor-version":[{"id":1673,"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/posts\/1671\/revisions\/1673"}],"wp:attachment":[{"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/media?parent=1671"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/categories?post=1671"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/tags?post=1671"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}