One of the main reasons the economy of Singapore is considered as one of the most progressive is because the government’s clever and effective implementation on its tax schemes which has made it a win-win situation for everyone inclusive of the economy and corporates. The rates placed are nearly unbeatable and there are plenty of exemptions and relief schemes to give any new company some breathing space. Usually on foreign soil new and upcoming companies are floundered by a heavy burden of taxes, this would reduce any future investments in that country again. Singapore invites investment and doesn’t hammer out companies with taxes which has become a stone in the foundation of their success.
Sell Your Capital and Assets with Nothing to Fear
While in most countries companies pay for a capital asset tax when selling one of their own assets Singapore has no capital asset tax, which means all the revenue a company would receive after selling off one its assets would be their own with no deductions. When the company has little to fear from any capital losses that they may incur due to government legislation then the company can freely invest on what they desire and manage their capital according to their preferences.
Set Your Own Financial Year to a Time of Your Own Choosing
While most tax schemes around the world automatically deem when your financial year is the tax system in Singapore has the flexibility to let the company itself decide. Coupled with this flexibility and of course that corporate-friendly headline rate of 17% as mentioned earlier, makes the Singapore economy a safe place to bet your investments in. Further information on this can be obtained from Singapore tax system and tax rates. As discussed before, being able to set your own financial year puts you in a strategic position to end a financial year at a peak-time in your business and minimize the effect of any deductions as a result of taxes.
A One Tier Tax System Means You Pay Up Only Once
The benefit of a one-tier system means there are no unpleasant surprises for corporates. The tax is deducted and once it is paid it serves as the final and only tax deduction on your income. Any extra dividends that your company might make will not be subjected to any other taxation. There is no uncertainty in this tax scheme implemented in the 2002 budget, as a company you know what you’re paying for and can rest easy knowing that there is no “double taxation.” As a result of this you can keep your shareholders happy and still keep a very good amount of your profit within the company.