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For GST-registered businesses

Not all services provided to overseas customers can be zero-rated.

You may zero-rate your supply of services (i.e. charge GST at 0%) if it falls within the description of international services under Section 21(3) of the GST Act.

Depending on the nature of service that you provide, you may need to determine the belonging status of your customer (i.e. whether your customer is a local person or an overseas person).

International services under section 21(3)

Please click on the relevant links for qualifying conditions to zero-rate and illustrative examples. 

Find out more information about international services on an extract of Section 21 of the GST Act  (207KB).

International transport (for goods and passengers)

 

No Type of services Qualifying criteria to zero-rate GST Act Examples & relevant e-Tax Guides
1 International transport of passengers

To qualify as international transport, the passengers must be  transported: 
(a) from Singapore to a place outside Singapore;
(b) from a place outside Singapore to Singapore; or
(c) from a place outside Singapore to another place outside Singapore.

With effect from 1 Jul 2010, the supply of international transport of passengers by sea qualifies for zero-rating in the following situations:

(a) where the transporting vessel is bound for or returning from a fixed port of call outside Singapore, that is to say -
- from a place outside Singapore to another place outside Singapore;
- from a place in Singapore to a place outside Singapore; or
- from a place outside Singapore to a place in Singapore.

(b) where the transporting vessel sails to or from international waters and the course of transportation occurs "substantially outside of Singapore".

The Comptroller will consider a course of transportation to be "substantially outside Singapore" if the travel in Singapore waters is only necessary for the purposes of departing to or returning from international waters.

S21(3)(a)

You are a local travel agent. Your customer buys a single air ticket for flights from Singapore to Japan and then to Los Angeles.

You may charge GST at 0% on the air tickets because it is a contract for international transport.

From 1 Jul 2010, "cruise-to-nowhere" packages, (i.e. cruises in international waters which do not dock at any port outside Singapore), will qualify for zero-rating relief.

GST: Travel Industry (150KB) 

GST Guide for the Marine Industry - 2010 Budget Changes (489KB) 

2
  • International transport of goods; and
  • Any transport of goods within Singapore (including handling, loading and unloading), as long as it is part of the international transport and is supplied by the same person or agent.

To qualify as international transport, the goods must be transported:
(a) from Singapore to a place outside Singapore;
(b) from a place outside Singapore to Singapore; or
(c) from a place outside Singapore to another place outside Singapore.

With effect from 1 Jul 2010, the supply of international transport of goods by sea qualifies for zero-rating in the following situations:

(a) where the transporting vessel is bound for or returning from a fixed port of call outside Singapore, that is to say-
- from a place outside Singapore to another place outside Singapore;
- from a place in Singapore to a place outside Singapore; or
- from a place outside Singapore to a place in Singapore.

(b) where the transporting vessel sails to or from international waters and the course of transportation occurs "substantially outside of Singapore".

The Comptroller will consider a course of transportation to be "substantially outside Singapore" if the travel in Singapore waters is only necessary for the purposes of departing to or returning from international waters.

Zero-rating also extends to supplies of domestic transport of goods (i.e. from a place in Singapore to another place in Singapore). This is provided that the domestic transport is supplied as part of the international transportation of goods, and is supplied by the same supplier. The supplier does not need to perform the domestic transport activities himself, but must be contracted to provide both the international and domestic leg of transportation. Zero-rating does not extend to domestic transport services provided to passengers.

S21(3)(a)
S21(3)(b)

You provide transport services from a warehouse in Singapore to the airport and then out of Singapore.
 
You may zero-rate the total value of transportation services (including the local transportation costs) since you are providing both international and domestic transportation services.

GST Guide for the Logistics Service Industry (536KB) 

GST Guide for the Marine Industry - 2010 Budget Changes (489KB) 

3 Other services in relation to international transportation of passengers or goods Services are:
(a) Insuring or arranging for insurance; or
(b) Arranging for international transportation.
S21(3)(c)

Premiums/ commissions for the following types of insurance:
 
(a) Marine cargo, Marine hull
(b) Aviation cargo, aviation hull
(c) Travel insurance (which is identifiable with journeys involving carriage of passengers to and from Singapore)

GST Guide for the Logistics Service Industry (536KB) 

GST Guide for the Insurance Industry (427KB) 

 
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Lease or hire of transport

 

No Type of services Qualifying criteria to zero-rate GST Act Examples & relevant e-Tax Guides
4 Lease or hire of any type of transport for use outside Singapore throughout the period of lease The transport is:
(a) exported by the lessor to such a place; or
(b) already outside Singapore at the time of the supply.
S21(3)(d) You may zero-rate your leasing services if you lease trucks for use in Johore.

 
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Services related to land/ buildings/ goods located overseas

 

No Type of services Qualifying criteria to zero-rate GST Act Examples & relevant e-Tax Guides
5 Services made directly in connection with land or buildings located outside Singapore

Services include:

(a) Services made in the course of construction, repair, and maintenance of any building.
(b) Services provided by estate agents, auctioneers, architects, and engineers.

Services must not include:
(a) the supply of a right to promulgate an advertisement by means of any medium of communication; and
(b) the promulgation of an advertisement by means of any medium of communication. 
S21(3)(e) An architect in Singapore provides design services in respect of a building located in China.

An estate agent in Singapore sells a house in London.

GST: Construction Industry (English version) (293KB)

GST and the Construction Industry (Chinese version) (269KB) 

6 Services performed directly in connection with goods located outside Singapore at the time the services are performed Services must not include:
(a) the supply of a right to promulgate an advertisement by means of any medium of communication; and
(b) the promulgation of an advertisement by means of any medium of communication.
S21(3)(f) A local company provides repair services for a computer network system in Malaysia.

 
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Services related to goods for export and goods moving outside Singapore

 

No Type of services Qualifying criteria to zero-rate GST Act Examples & relevant e-Tax Guides
7 Services performed directly in connection with goods for export and supplied to an overseas customer, at the time the services are performed. Services must not include:
(a) the supply of a right to promulgate an advertisement by means of any medium of communication; and
(b) the promulgation of an advertisement by means of any medium of communication. 
S21(3)(g)  You provide engraving services on pewter vases meant for export to Australia, and the service is billed to an overseas customer.

You provide domestic transportation service to an overseas customer to collect the goods from a local warehouse and deliver to the airport for export to overseas.

GST Guide for the Logistics Service Industry (536KB)

Clarification on 'Directly in Connection with' and 'Directly Benefit' (471KB) 

8 Certain financial services supplied in connection with goods for export or goods that are moved from a place outside Singapore to another place outside Singapore (i.e. out-of-scope supplies of goods) The services are prescribed in the First Schedule of GST (International Services) Order. Please refer to paragraph (h) in the extract of Section 21 of the GST Act (207KB) S21(3)(h) 

An insurance company provides export credit insurance to company A to protect company A from non-payment by its overseas customer for goods exported.

GST Guide for the Insurance Industry (427KB)

 
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Services performed completely overseas

 

No Type of services Qualifying criteria to zero-rate GST Act Examples & relevant e-Tax Guides
9 Services performed completely outside Singapore Services are any of the following:

(a) cultural, artistic, sporting, educational, or entertainment services,
(b) exhibition or convention services; or
(c) other services that are supplementary to, including organising the performance outside Singapore, the services referred to in (a) and (b) above.

S21(3)(i)

An event management company charges a fee for organising a concert in Malaysia.

A management course is wholly conducted in Beijing, China.

 
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Services supplied to overseas person

 

No Type of services Qualifying criteria to zero-rate GST Act Examples & relevant e-Tax Guides
10

Services supplied:

The overseas person must not be in Singapore at the time the services are performed. 

Services must not relate to land or goods in Singapore, other than goods referred to in S21(3)(g).

Services must not include:
(a) the supply of a right to promulgate an advertisement by means of any medium of communication; and
(b) the promulgation of an advertisement by means of any medium of communication.

S21(3)(j)  You provide market research services on ‘price of medical services’ for an overseas company.
11

Certain services supplied:

Unlike S21(3)(j) above, your overseas customer can be in Singapore to receive your services.

Services are within the list of prescribed services:


(a) Services of engineers, accountants, lawyers and other similar consultancy services;

(b) Data processing and provision of information;

For (a) and (b), the services must not relate directly to any land or goods situated in Singapore.
 
(c) The testing of a sample of goods taken from or forming part of:

  • goods that are outside Singapore at the time the services are performed, or
  • goods for export outside Singapore;

(d) Handling or storage of goods at, or their transport to or from the place at which they are to be exported or have been imported, or the handling or storage of such goods in connection with such transport
 
(e) Exhibition or convention services;
 
(f) Training or retraining for any business or employment;
 
(g) Services supplementary to, including the organising services referred to in sub-paragraphs (e) and (f).
 
The above list of prescribed services shall not include any services relating to accommodation and entertainment

S21(3)(k) 

Example for (a) and (b):
You provide consultancy services on ‘feasibility of conducting business in Singapore’ to your overseas customer.

Example for (d) :
If you supply transportation and handling services to an overseas customer from the point of import (e.g. Free Trade Zone) to the warehouse that the goods were consigned, your transportation and handling services can be zero-rated.

GST Guide for the Logistics Service Industry (536KB)

Example for (f) and (g):
You provide training (excluding formal education courses such as diploma, graduate and post-graduates courses) in Singapore for participants from all over the world (including Singapore). You may zero-rate your training fees to overseas companies who send their overseas staff to attend the course in Singapore.

 
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Supplies related to ships or aircraft

For GST purposes, an aircraft refers to one which is:   

  • not used or intended to be used for recreation or pleasure; or
  • if it is used or intended for use for recreation or pleasure, it should be wholly used or intended to be wholly used for international travel –
    a) from a place outside Singapore to another place outside Singapore; or
    b) from a place in Singapore to a place outside Singapore; or
    c) from a place outside Singapore to a place in Singapore.

For GST purposes, a ship refers to one which is:

  • not designed or adapted for use for recreation or pleasure; and 
  • excludes any ship licensed under the Maritime and Port Authority of Singapore (MPA) Act as a passenger harbour craft or pleasure craft.

With effect from 1 Jul 2010, the meaning of ship has been expanded to include ships used or adapted for recreation or pleasure provided that they are wholly internationally bound. However, ships that are licensed by MPA as passenger harbour craft and pleasure craft continued to be excluded.

With effect from 1 Jan 2011, the meaning of ship will also exclude ships that are granted vessel permits by the Public Utilities Board.

For details, please refer to the e-Tax guide on GST Guide for the Marine Industry – 2010 Budget Changes (489KB).

No Type of services Qualifying criteria to zero-rate GST Act Examples & relevant e-Tax Guides
12 Certain services in connection with:
(a) the handling of ships or aircraft, or
(b) the handling or storage of goods carried in the ship and aircraft.
The services are prescribed in the Third Schedule of GST (International Services) Order. Please refer to paragraph (l) in the extract of Section 21 of the GST Act (207KB).   S21(3)(l)
GST Guide for the Aerospace Industry (928KB) 

GST Guide for the Marine Industry - 2010 Budget Changes (489KB) 

GST Guide for Logistics Service Industry (536KB) - relevant only for item no. 12
13 Pilotage, salvage or towage services   S21(3)(m)
14 Services comprising the surveying or classification of any ship and aircraft for the purposes of any register   S21(3)(n)
15 Supply (including the letting and hire) of any ship or aircraft  The ship or aircraft is not leased for the purpose of providing such services performed substantially in Singapore:
  • transportation,
  • accommodation,
  • entertainment,
  • catering of food or beverages, or
  • education services
S21(3)(o)
16 Certain services comprising the repair, maintenance, broking or management of any ship or aircraft The services are prescribed in the Sixth Schedule of GST (International Services) Order. Please refer to paragraph (p) in the extract of Section 21 of the GST Act (207KB)   S21(3)(p) 
17 Supply (including the letting or hire) of qualifying aircraft parts

Aircraft parts must be parts and equipments designed and built for exclusive use on an aircraft; and are certified as airworthy by:

  • a person certificated by a national civil aviation authority (in relation to an aircraft that is not a military aircraft); and 
  • the government owning that aircraft (in relation to a military aircraft)
S21(3)(x) 

 
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Telecommunication services

 

No Type of services Qualifying criteria to zero-rate GST Act Examples & relevant e-Tax Guides
18

Certain services comprising the provision of telecommunications transmitted

  • into and out of Singapore; or
  • outside Singapore. 
The services are prescribed in the Fifth Schedule of GST (International Services) Order. Please refer to paragraph (q) in the extract of Section 21 of the GST Act (207KB).   S21(3)(q) Zero-rating Telecommunication and Related Services under Section 21(3)(q)  (202KB) 

 
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Trust services

 

No Type of services Qualifying criteria to zero-rate GST Act Examples & relevant e-Tax Guides
19

Trust services in relation to a foreign trust

(a) a trustee of the foreign trust (including a trust company providing services in its capacity as trustee of the foreign trust); or
(b) a trust company to a trustee of the foreign trust
S21(3)(r)   

 
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Co-location services (for computer server equipment)

 

No Type of services Qualifying criteria to zero-rate GST Act Examples & relevant e-Tax Guides
20

Co-location service in Singapore of computer server equipment
(i.e. providing a physical environment for the operation of computer server equipment) 

Services:
(a) are under a contract with an 
overseas person; and
(b) directly benefits an 
overseas person.
 S21(3)(s) GST Treatment of Web-Hosting Services and Server Co-location Services (253KB)

 
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Services related to electronic system

 

No Type of services Qualifying criteria to zero-rate GST Act Examples & relevant e-Tax Guides
21

Certain services in connection with the provision of an electronic system relating to import and export of goods 

The services are prescribed in the Seventh Schedule of GST (International Services) Order. Please refer to paragraph (t) in the extract of Section 21 of the GST Act (207KB)    S21(3)(t)  You provide an electronic system through which application of import/ export permits can be made. You may zero-rate the processing fee to your customers for the application of import/ export permits.

 
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Advertising services

 

No Type of services Qualifying criteria to zero-rate GST Act Examples & relevant e-Tax Guides
22 Advertising services The GST treatment for advertising is based on the different nature of services.

(a) Media Sales - place of circulation is substantially outside Singapore

(b) Media Planning - contractually to and directly benefiting overseas person 

(c) Creative and Production Sales - contractually to and directly benefiting overseas person 

(d) Brand Public Relation - contractually to and directly benefiting overseas person 

(e) Event Organising - place of event or contractually to & directly benefiting overseas person in his business capacity

S21(3)(j)
S21(3)(k)
S21(3)(u) 
 GST: Guide for Advertising Industry   (462KB)

 
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Supplies related to air and sea containers

 

No Type of services Qualifying criteria to zero-rate GST Act Examples & relevant e-Tax Guides
23 Sale and lease of air and sea containers

The containers:
(a) are used or to be used for international transportation of goods; and
(b) comply with the prescribed requirements in the Eight Schedule of GST (International Services) Order.

Please refer to paragraph (v) in the extract of Section 21 of the GST Act (207KB)

S21(3)(v)
GST: Zero-rating of Container Services and the Sale & Lease of Containers (259KB)
24 Certain services comprising the repair, maintenance or management of any air or sea containers.

The containers:
(a) are used or to be used for international transportation of goods; and
(b) comply with the prescribed requirements in the Eight Schedule of GST (International Services) Order.

Please refer to paragraph (w) in the extract of Section 21 of the GST Act (207KB). 

S21(3)(w)

 
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Services performed on goods stored in a warehouse under the Specialised Warehouse Scheme 

 

No Type of services Qualifying criteria to zero-rate GST Act Examples & relevant e-Tax Guides
25 Qualifying services performed on qualifying goods stored in a warehouse under the Specialised Warehouse Scheme (SWS), and supplied: 

It includes services performed on the goods during the period in which the goods are removed from the warehouse under the Temporary Removal for Repair and Maintenance  or for Auctions and Exhibitions , and returned to any warehouse under SWS after the event.

The services are:
  • storage services;
  • goods management services;
  • services of holding an auction or exhibition of the goods;
  • broking services and other similar services;
  • conservation and restoration services;
  • valuation services; and
  • insurance services.

The above services must be performed on the following goods:

  • a work of art;
  • an antique;
  • an artefact;
  • a collector's item;
  • a precious metal (gold, silver, platinum, palladium);
  • a precious stone (diamond, ruby, sapphire, emerald);
  • jewellery; or
  • wine,

as prescribed in the Ninth Schedule of the GST (International Services) Order.

Please refer to paragraph (y) in the extract of Section 21 of the GST Act (207KB).

S21(3)(y)  Specialised Warehouse Scheme and Zero-rating of Supplies (368KB)

The e-Tax guide also contains information on the zero-rating of a supply to occupy storage space in a warehouse under SWS (e.g. the provision of 'private storage units') that is regarded as a supply of goods, instead of storage services, for GST purposes. 

 
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Belonging status of your customer

Under certain zero-rating provisions e.g. sections 21(3) (j), (k) and (s), you need to determine if your customer belongs to a country outside Singapore before you can zero-rate your services.

Your customer is an individual

Your customer shall be treated as belonging in Singapore if his usual place of residence is in Singapore during the period of service.

For GST purposes, an individual should just have one usual place of residence at any point in time. The "usual place of residence" of an individual should have the following attributes:

  • The individual stays in that country voluntarily and for a settled purpose, such as to pursue a course of study or due to employment; and
  • The individual’s stay in that country has some degree of continuity, apart from temporary or occasional absence, such that it forms part of the regular and habitual pattern of his life.

Use of residential address as proxy

The Comptroller of GST may regard the residential address of an individual as his "usual place of residence". Hence, if your customer provides a Singapore residential address, he shall be regarded as belonging in Singapore for GST purposes.

More than one residential address

There may be cases where an individual stays overseas to study or work and he has more than one residential address. With effect from 1 Apr 2010, the Comptroller of GST may regard the individual as belonging overseas if all of the following conditions are satisfied:

  • He is absent from Singapore for a continuous period of at least one year. It does not matter that he spends his holidays in Singapore during that one year. During that year, his temporary return to Singapore for vacation or other reasonable purposes is acceptable.
  • He stays at a fixed place in the overseas country.
  • Where he is working in the overseas country, his overseas assignment must not be incidental to his employment in Singapore. For example, an individual sent to work overseas by his local employer will not satisfy this condition and therefore will be treated as belonging in Singapore.

If it is certain before your customer’s departure from Singapore that the above conditions are satisfied, your customer can be treated as belonging overseas for the entire duration of his overseas stay.

Your customer is a business

Your customer shall be treated as belonging in Singapore if:

  • It has a business establishment or some fixed establishment in Singapore and nowhere else.
  • It has no business or fixed establishment in any country; but he is legally constituted in Singapore (e.g. company incorporated in Singapore).
  • It has such establishments both in Singapore and outside of Singapore. The establishment, at which the services are most directly used or to be used, is the establishment in Singapore

Business establishment

This is the place from which the business is run. If your customer carries on a business through a branch in Singapore, he shall be treated as having a business establishment in Singapore.

Fixed establishment

A fixed establishment is an establishment, other than the business establishment, that has both the technical and human resources necessary to provide or receive services on a permanent basis.

Example:

Company A is incorporated in Japan. It has no branch in Singapore but has an office and staff in Singapore to help provide support services to its customers in Singapore. The existence of an office and staff in Singapore creates a fixed establishment in Singapore.

 
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FAQs

No. Under section 21(3)(j), the services must be provided to an overseas person who is not in Singapore at the time the services are performed. Not all services provided to an overseas person can be zero-rated.


Services performed completely outside Singapore may only be zero-rated if it falls within the list of services described in section 21(3)(i). Consultancy services do not fall within the list of services. Hence, you should standard-rate your consultancy services.

Exceptions:
1) If your services are directly in connection with land or building located outside Singapore, you may zero-rate your services under section 21(3)(e).
2) If your services are directly in connection with goods located outside Singapore at the time services are performed, you may zero-rate your services under section 21(3)(f).


 

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Last Updated on 19 November 2014


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