Basic Guide for New Companies

 All companies are required to submit the following forms to IRAS every year:

Filing of Estimated Chargeable Income (ECI)

New companies incorporated in 2016 are required to file the ECI within three months from the company's first financial year end.

If your company is incorporated in 2016 and closes its first set of accounts in 2016, no ECI filing notification will be sent to you in 2016 as most companies do not close their first set of accounts in the year of incorporation. However, you are still required to file the ECI within three months from your company's first financial year end, unless the company qualifies for the administrative concession and does not need to file the ECI.

As most companies have their financial year end on 31 Dec, a new company is required to inform IRAS if its financial year end is not 31 Dec. For details, please refer to Updating Company Particulars.

Otherwise, you will receive the ECI notification from IRAS in Dec, starting from the year after the year of incorporation. If your company is incorporated in 2016 and closes its first set of accounts in Dec 2017, you will receive a ECI notification from IRAS in Dec 2017 reminding you to e-File your ECI by Mar 2018.

Example

Note :

As the company's first set of accounts covers a period of more than 12 months from the date of incorporation, its profit/losses must be attributed and declared under two YAs as follows:

• YA 2017 covering the basis period from 15 Jul 2016 to 31 Dec 2016; and
• YA 2018 covering the basis period from 1 Jan 2017 to 31 Dec 2017.

Time apportionment basis may be used if the company is not able to directly identify income and expenses to the two periods.

Find out more about Basis Period and Year of Assessment.

Companies That Do Not Need to Submit ECI

^Revised!To reduce the compliance cost on businesses, IRAS will improve the tax-filing process for companies by increasing the annual revenue threshold for ECI waiver from the current $1 million to $5 million. Your company does not need to file its ECI for the particular YA if it meets the following criteria:

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

There is no need to inform IRAS if the company meets the conditions and does not need to file its ECI.

For details, please refer to the FAQs section of Companies That Do Not Need to Submit Estimated Chargeable Income (ECI).

Filing of Form C-S/ C

Getting the Form C-S/ C

New companies will start to receive the Form C-S/ C e-Filing notification letter only two years after their year of incorporation, as most do not close their first set of financial statements in the year of incorporation. For example, a company incorporated in 2016 will receive its first e-Filing notification letter for YA 2018 in May 2018.

If your company closed its first set of financial statements in the year of incorporation and has commenced business or was in receipt of any income, please request an income tax return filing notification letter from IRAS by May of the year following the year of incorporation, by submitting this form “ Request for Income Tax Return (Form C-S/ C) and Notification of New Financial Year End” to IRAS by post or email. For example, if your company is incorporated in 2016 and closes its accounts in 2016, you will need to file your company’s first Income Tax Return (Form C-S/C) in YA 2017 if you have commenced business or received any income in 2016.

IRAS will process your request within 7 days of receipt of the form. Once processed, you will be able to view the Corporate Tax Filing Status , and start e-Filing the Form C-S/ C for YA 2017 at mytax.iras.gov.sg. An e-Filing notification letter will also be sent to the company.

Find out whether you qualify to file the simplified Form C (Form C-S) here. 

e-Filing of Form C-S/ C

To e-File the Form C-S/ C at mytax.iras.gov.sg, please ensure that you have authorised yourself, your staff or a 3rd party (e.g., your tax agent) via the e-Services Authorisation system ( EASY). Please have the following information on hand

• Company's tax reference number (e.g. 200912345N, T12AA3456X, A1234567)
• Company's e-Services Access Code*
• Personal tax reference number (e.g. S1234567Z, G1234567Z)
• SingPass or IRAS PIN

* If your company does not have an Access Code, you should obtain one by completing the Application for e-Services Access Code (65.5KB). The Access Code will be mailed to your company's registered address in IRAS' record within 4 working days.

For companies whose first set of accounts covers a period of more than 12 months from the date of incorporation, please refer to the section below on Attribution of Profits/ Losses for New Companies for more information. 

Some new companies operate more than 12 months before closing their first set of accounts. When this happens, the first set of accounts covers more than 12 months.

Generally, the basis period cannot exceed 12 months, so the profits or losses must be apportioned and attributed to two different YAs.

The company should directly identify the income earned and expenses incurred for each of the two YAs, based on the actual dates the income was earned and the expenses were incurred. If this cannot be done, time apportionment basis can be applied (i.e. apportion based on number of days in the corresponding YAs).

Example

Generally, expenses incurred before a business starts its operations are not tax-deductible as these are incurred for the purpose of setting up the operations and not 'wholly and exclusively' for the production of income.

To assist business in enterprise development, revenue expenses incurred one year prior to the deemed date of commencement of business will be deductible for tax purposes.

For more details on the deductibility of expenses incurred before commencement of business and how to determine the actual date of commencement of business, please refer to the Tax Treatment of Business Expenses.

Company representatives who are responsible for the preparation and filing of the Income Tax Return (Form C-S/ C) and other corporate tax matters are encouraged to sign up for a free one-day Corporate Tax Seminar conducted by IRAS from Jun to Nov each year.