Companies That Do Not Need to Submit Estimated Chargeable Income (ECI)

Certain companies do not need to file Estimated Chargeable Income (ECI) even if they have received the ECI notification from IRAS.

Waiver to File ECI

To reduce the compliance cost of businesses, IRAS has revised the criteria for ECI waiver as follows:

Company's Financial Year ends Criteria for ECI waiver 
In or before Jun 2017 
  1. annual revenue is not more than $1 million for the financial year; and
  2. ECI* is NIL for the YA.
In or after Jul 2017
  1. annual revenue is not more than $5 million for the financial year; and
  2. ECI* is NIL for the YA.

* The ECI should be the amount before deducting the exempt amount under the partial tax exemption scheme or the tax exemption scheme for new start-up companies.

Companies must meet both criteria 1 and 2 to qualify for the waiver to file ECI.

UpdatedExamples of how the ECI waiver criteria is applied 

 Financial Year End Basis Period for YA 2019Due Date for Filing ECI Revenue  ECIQualifies for Waiver to File ECI?
 Jun 2018    Jul 2017 to Jun 2018     30 Sep 2018    $5 million $100,000No 
$10 millionNilNo
$5 millionNilYes

Companies are required to self-assess if they meet the criteria for the waiver to file ECI. New companies that have yet to file their first Corporate Tax Return (Form C-S/ C) can use The New Company Start-Up Kit to better understand their corporate tax obligations, including if they meet the criteria for the waiver to file ECI.

Companies that meet the criteria do not need to file their ECI for that particular YA, even though the company’s ECI filing status for the YA at myTax Portal shows “Ready to File”. There is no need to seek confirmation from or inform IRAS.

If they do not meet any of the criteria 1 and 2, they will need to file their ECI for that particular YA.

For details, please refer to the FAQs section below on the Waiver to File ECI.

Other Entities Specifically Not Required to File ECI

The following entities do not need to file ECI

  1. Foreign ship owners or charterers for whom the Shipping Return (75KB) has been or would be submitted by the local shipping agent;
  2. Foreign universities;
  3. Designated unit trusts and approved CPF unit trusts#
  4. Real estate investment trusts that have been granted the tax treatment under Section 43(2) of the Income Tax Act; and
  5. Any other specific case granted waiver to furnish ECI by IRAS, e.g. via an advance ruling issued.

#As approved under Section 35(14) of the Income Tax Act and for the purposes of any investment scheme under the Central Provident Fund Act respectively. For these unit trusts, the income listed under Sections 35(12) and 35(12A) of the Income Tax Act is not taxed at the trustee level. Other income not covered by these Sections is likely to be negligible and hence there is no need for these unit trusts to furnish ECI.

FAQs

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