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Filing Estimated Chargeable Income (ECI) in Singapore

Filing Estimated Chargeable Income (ECI) in Singapore

All companies in Singapore are required to file various financial statements with the local authorities. The documents which need to be filed depend on the type of company registered and on whether the company is subject to filing exemption rules or not.

One of the statements which must be filed by companies in Singapore is the Estimated Chargeable Income or ECI. This declaration is an estimate of a company’s taxable income which is calculated after all tax allownaces and expenses of the said company are deducted for the Year of Assessment (YA).

Below, we explain the Estimated Chargeable Income filing requirements for companies in Singapore. You can rely on our Singapore company formation specialists for assistance in preparing and filing the ECI. We can also assist those who want to open a company in Singapore with personalized business registration services.

When must the ECI be filed?

The ECI has been implemented in Singapore’s taxation system starting with 2017.

The Estimated Chargeable Income must be filed no later than 3 months after the financial year of a company has terminated. There are also two exceptions to this rule for Singapore companies which qualify for the administrative concession and for those which are not subject to this filing requirement.

Our company formation agents in Singapore work alongside dedicated accountants who can explain the ECI filing requirements, as well as the exceptions from this financial statement filing.

Companies required to file the ECI with the Singapore authorities

The following companies are required to file the Estimated Chargeable Income with the Singapore Inland Revenue Authority (IRAS):

  1. companies with an annual revenue of more than 10 million SGD for the YA 2017;
  2. companies with an annual revenue of more than 1 million SGD for the YA 2018;
  3. all companies registered in Singapore will need to file the ECI starting with 2020;
  4. new companies must also file the ECI following a specific notification sent by the IRAS.

It is important to note that starting with 2020, all companies in Singapore will be required to file the ECI through IRAS’ online system. For that purpose, companies must designate a person (usually one of the directors or managers) as an approved person to file financial statements. All companies must obtain the CorpPass IDs and numbers.

Our company registration advisors in Singapore can explain the registration requirements with the IRAS. We can also assist with the tax registration requisites as part of the business incorporation procedure.

The declaration of revenue in the ECI

The ECI must contain information about the revenues of a company, which is why a Singapore business must file along this statement a declaration of revenue. The declaration must contain information about the company’s earnings from the main source of income which must not include the disposal of assets.

It is also important to note that the declaration of revenue will be based on the audited financial accounts of the company.

Should you need audit services in Singapore, our specialists can provide them to you.

Paying taxes based on the ECI in Singapore

The Estimated Chargeable Income comes with several advantages for companies in Singapore. Among these, one of the most important is that a corporate tax rebate is offered by the IRAS to companies filing the ECI. The rebate is offered in the limit of 10,000 SGD. The rebate will be automatically computed by the IRAS upon the filing of the ECI.

Another advantage of the Estimated Chargeable Income is that when filed electronically, Singapore companies with a GIRO account can pay their taxes in installments.

Startup companies which qualify for the Tax Exemption Scheme will also benefit from tax rebates which will be computed and granted automatically by the IRAS.

If you want to open a company in Singapore as a startup and need assistance or information about the conditions to qualify as a startup, our consultants can guide you.

Investing in Singapore

Singapore is an important trading and financial hub in Southeast Asia, however, the city-state relies on foreign investments in other industries than the financial and trading ones. For example:

  • – the number of greenfield investments in 2018 was 420, as Singapore is known for caring about the protection of the environment;
  • – wholesale and retail are other important industries which retained 18.5% of the foreign investments in 2017;
  • – manufacturing is another economic sector which attracted 11.6% of foreign investments in 2017;
  • – in 2018, Singapore’s Foreign Direct Investments (FDIs) stock was 1,48 million USD.

For complete information about filing the Estimated Chargeable Income, please contact our company formation agents in Singapore.