Increase Your Understanding on Various Aspects of Singapore Estimated Chargeable Income (ECI)
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SBS
Mar 1, 2015, 4:07:05 PM3/1/15
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Article Title: Increase Your Understanding on Various Aspects of Singapore Estimated Chargeable Income (ECI)
Author: SBS
Word Count: 890
Article URL: http://www.isnare.com/?aid=1927695&ca=Business
Format: 64cpl
Contact The Author: http://www.isnare.com/eta.php?aid=1927695
Easy Publish Tool: http://www.isnare.com/html.php?aid=1927695
*********************** ARTICLE START ***********************
So, you have heard how the flexible Singapore taxation system is; but have you heard how difficult it is to comply with the taxation laws in Singapore. Well! Apart from so many laws to comply with, IRAS implies that it is mandatory for each Singapore Company to file their Estimated Chargeable Income (ECI) within three months starting from the end of the financial year.
What actually is ECI?
Estimated Chargeable Income is the full form of ECI and is the net chargeable income for a company in a single Year of Assessment (YA). Out of so many corporate compliance requirements, filing estimated chargeable income is one of the necessary IRAS compliance guidelines. IRAS has specifically mandated that it is necessary for every Singapore incorporated business to submit an ECI for the next YA within three months after the end of previous financial year. By any chance there happens to be any company having a net income in any YA then such companies will have to file a ‘NIL’ ECI.
Who Is Eligible to File an ECI?
All the companies incorporated in Singapore need to submit their Estimated Chargeable Income irrespective of their size, type or status.
Usually IRAS sends a notification to all the eligible companies for filing their ECI at the end, i.e. in the last month (December) of the financial year. By any reason, if any company does not receive ECI Filing notification from IRAS, it is expected that such companies proactively submit their Estimated Chargeable Income within three months after starting the new financial year.
It happens that due to different reasons chargeable income of a company is zero in a specific financial year. Still, such companies are required to file a NIL ECI except if the company has qualified for any administrative concession.
What happens if your Company has submitted more/less ECI than the Actual Chargeable Income?
Possibilities can’t be denied that some companies submit more ECI than the actual chargeable income reported in their Form C or Form C-S. In such scenario, the excess tax paid earlier by those companies will automatically be refunded back to them.
On the contrary, ECI submitted by some companies often turns out to be less than the actual chargeable income reported in their Form c or Form C-S. Such companies need to pay their additional taxes within 30 days from the notice of assessment date.
IRAS further makes it clear that if there happens to be a significant difference between submitted ECI and the chargeable income mentioned in Form C or Form C-S then, such companies will have to provide a satisfactory explanation.
Analyzing and Understanding the Estimated Chargeable income
According to IRAS, “Estimated Chargeable Income is the appraisement of a company’s chargeable income for the concerned Year of Assessment that is considered unique for every Singapore Company Setup”. A well-furbished ECI statement contains no mention of gained or disposed fixed assets, but only estimated revenue company will be generating in the current fiscal year.
Usually, Singapore companies were disclosing their taxable income or the net generated revenue for their Income Tax Returns (Form-C). Since 1 January 2009, IRAS made it mandatory for the companies to mention possible revenue amount in the ECI form as well.
IRAS thinks that submitting ECI is like predicting the annual performance of the company and this key economical data helps IRAS to plan and strategize the further development of businesses and industries in Singapore.
Administrative Concession or Waiving Requirement to File ECI
Criteria for Companies to Qualify
Upon meeting below two conditions, companies are not required to file their Estimated Chargeable Income
-> If annual revenue of your company is less than $1 million in a specific financial year
-> If your ECI is Nil
Criteria for Other Entities to Qualify
Entities that are exempt from filing ECI are as follows
-> Foreign ship owners or Charterers for whom the local shipping agent has or will be submitting
-> Foreign universities Designated Unite Trusts and Approved CPF unit Trusts
-> Real Estate Investment Trusts having earned tax treatment under Section 43(2) of the Income Tax Act
-> Other special entities granted waiver to submit ECI by IRAS like issuance of advance ruling
What Advantages Companies Get For Filing ECI
• Companies submitting their ECI earlier receive a complementary gift from IRAS wherein they are provided with an option of a flexible payment scheme to pay their taxes.
• Earlier the submissions of ECI, higher are the chances of bestowing payment installments.
• For example, the company’s e-filing their ECI until 26th in the first month of the new financial year receive almost 10 payment installments for paying their taxes. If the ECI is filed by 26 of the second month in the new financial year; then, such companies get 8 installments to pay their taxes and 6 installments for the companies filing their ECI on the 26th of the third month in the new financial year.
*********************** ARTICLE END ***********************
- To distribute your articles go to http://www.isnare.com/distribution.php
- For more free-reprint articles go to http://www.isnare.com
Message delivered directly to members of the group:
publish-the...@googlegroups.com
*****************************************************************
Please consider this free-reprint article written by:
SBS
*****************************
IMPORTANT - Publication/Reprint Terms
- You have permission to publish this article electronically in free-only publications such as a website or an ezine as long as the bylines are included.
- You are not allowed to use this article for commercial purposes. The article should only be reprinted in a publicly accessible website and not in a members-only commercial site.
- You are not allowed to post/reprint this article in any sites/publications that contains or supports hate, violence, porn and warez or any indecent and illegal sites/publications.
- You are not allowed to use this article in UCE (Unsolicited Commercial Email) or SPAM. This article MUST be distributed in an opt-in email list only.
- If you distribute this article in an ezine or newsletter, we ask that you send a copy of the newsletter or ezine that contains the article to http://www.isnare.com/eta.php?aid=1927695
- If you post this article in a website/forum/blog, ALL links MUST be set to hyperlinks and we ask that you send a copy of the URL where the article is posted to http://www.isnare.com/eta.php?aid=1927695
- We request that you ask permission from the author if you want to publish this article in print.
The role of iSnare.com is only to distribute this article as part of its Article Distribution feature ( http://www.isnare.com/distribution.php ). iSnare.com does NOT own this article, please respect the author's copyright and this publication/reprint terms. If you do not agree to any of these terms, please do not reprint or publish this article.
*****************************
Article Title: Increase Your Understanding on Various Aspects of Singapore Estimated Chargeable Income (ECI)
Author: SBS
Word Count: 890
Article URL: http://www.isnare.com/?aid=1927695&ca=Business
Format: 64cpl
Contact The Author: http://www.isnare.com/eta.php?aid=1927695
Easy Publish Tool: http://www.isnare.com/html.php?aid=1927695
*********************** ARTICLE START ***********************
So, you have heard how the flexible Singapore taxation system is; but have you heard how difficult it is to comply with the taxation laws in Singapore. Well! Apart from so many laws to comply with, IRAS implies that it is mandatory for each Singapore Company to file their Estimated Chargeable Income (ECI) within three months starting from the end of the financial year.
What actually is ECI?
Estimated Chargeable Income is the full form of ECI and is the net chargeable income for a company in a single Year of Assessment (YA). Out of so many corporate compliance requirements, filing estimated chargeable income is one of the necessary IRAS compliance guidelines. IRAS has specifically mandated that it is necessary for every Singapore incorporated business to submit an ECI for the next YA within three months after the end of previous financial year. By any chance there happens to be any company having a net income in any YA then such companies will have to file a ‘NIL’ ECI.
Who Is Eligible to File an ECI?
All the companies incorporated in Singapore need to submit their Estimated Chargeable Income irrespective of their size, type or status.
Usually IRAS sends a notification to all the eligible companies for filing their ECI at the end, i.e. in the last month (December) of the financial year. By any reason, if any company does not receive ECI Filing notification from IRAS, it is expected that such companies proactively submit their Estimated Chargeable Income within three months after starting the new financial year.
It happens that due to different reasons chargeable income of a company is zero in a specific financial year. Still, such companies are required to file a NIL ECI except if the company has qualified for any administrative concession.
What happens if your Company has submitted more/less ECI than the Actual Chargeable Income?
Possibilities can’t be denied that some companies submit more ECI than the actual chargeable income reported in their Form C or Form C-S. In such scenario, the excess tax paid earlier by those companies will automatically be refunded back to them.
On the contrary, ECI submitted by some companies often turns out to be less than the actual chargeable income reported in their Form c or Form C-S. Such companies need to pay their additional taxes within 30 days from the notice of assessment date.
IRAS further makes it clear that if there happens to be a significant difference between submitted ECI and the chargeable income mentioned in Form C or Form C-S then, such companies will have to provide a satisfactory explanation.
Analyzing and Understanding the Estimated Chargeable income
According to IRAS, “Estimated Chargeable Income is the appraisement of a company’s chargeable income for the concerned Year of Assessment that is considered unique for every Singapore Company Setup”. A well-furbished ECI statement contains no mention of gained or disposed fixed assets, but only estimated revenue company will be generating in the current fiscal year.
Usually, Singapore companies were disclosing their taxable income or the net generated revenue for their Income Tax Returns (Form-C). Since 1 January 2009, IRAS made it mandatory for the companies to mention possible revenue amount in the ECI form as well.
IRAS thinks that submitting ECI is like predicting the annual performance of the company and this key economical data helps IRAS to plan and strategize the further development of businesses and industries in Singapore.
Administrative Concession or Waiving Requirement to File ECI
Criteria for Companies to Qualify
Upon meeting below two conditions, companies are not required to file their Estimated Chargeable Income
-> If annual revenue of your company is less than $1 million in a specific financial year
-> If your ECI is Nil
Criteria for Other Entities to Qualify
Entities that are exempt from filing ECI are as follows
-> Foreign ship owners or Charterers for whom the local shipping agent has or will be submitting
-> Foreign universities Designated Unite Trusts and Approved CPF unit Trusts
-> Real Estate Investment Trusts having earned tax treatment under Section 43(2) of the Income Tax Act
-> Other special entities granted waiver to submit ECI by IRAS like issuance of advance ruling
What Advantages Companies Get For Filing ECI
• Companies submitting their ECI earlier receive a complementary gift from IRAS wherein they are provided with an option of a flexible payment scheme to pay their taxes.
• Earlier the submissions of ECI, higher are the chances of bestowing payment installments.
• For example, the company’s e-filing their ECI until 26th in the first month of the new financial year receive almost 10 payment installments for paying their taxes. If the ECI is filed by 26 of the second month in the new financial year; then, such companies get 8 installments to pay their taxes and 6 installments for the companies filing their ECI on the 26th of the third month in the new financial year.
*********************** ARTICLE END ***********************
- To distribute your articles go to http://www.isnare.com/distribution.php
- For more free-reprint articles go to http://www.isnare.com
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