Marine and Shipping

Zero-rating of supplies relating to ships, management of ships, etc. and changes introduced by Budget 2011 including the launch of the Approved Marine Customer Scheme and expanded scope of s21(3)(p).

Definition of Ship

A ship for the purposes of applying Sections 21(3)(l), (m), (n), (o) and (p) of the GST Act is defined as any ship (including an oil rig) but does not include any ship which is:

  1. Licensed under the Maritime and Port Authority of Singapore (MPA) Act as a passenger harbour craft or pleasure craft;
  2. Granted a vessel permit by the Public Utilities Board; and
  3. Designed or adapted for use for recreation or pleasure and is used within Singapore.

For details, please refer to GST Guide for the Marine Industry (479KB).

Zero-Rating of Supplies Relating to Ships

You need to charge GST on services that you provide. Where the supplies qualify as international services under Section 21(3) of the GST Act, you may zero-rate your supply of service (i.e. charge GST at 0%).

International Transport of Passengers or Goods by Sea 

Transportation of passengers or goods by sea:

  1. from a place outside Singapore to another place outside Singapore;
  2. from a place in Singapore to international waters; or
  3. from international waters to a place in Singapore.

Freight-related charges (e.g. bill of lading fee) and container-related charges (e.g. demurrage and detention fees) billed by shipping lines are considered as ancillary to international transportation.

Not applicable.

Relevant Section for Zero-Rating
S21(3)(a) of the GST Act

Handling of Ships or Goods Carried in a Ship

Certain services in connection with:

  1. the handling of ships; or
  2. the handling or storage of goods carried in the ship.

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 (192KB).

Relevant Section for Zero-Rating
S21(3)(l) of the GST Act

Pilotage, Salvage or Towage Services

Not applicable

Relevant Section for Zero-Rating
S21(3)(m) of the GST Act

Surveying or Classification Services

Services comprising the surveying or classification of any ship for the purposes of any register.

Not applicable.

Relevant Section for Zero-Rating
S21(3)(n) of the GST Act

Supply (Including Letting or Hire) of Any Ship

The ship is not leased for the purpose of providing such services performed substantially in Singapore:

  1. transportation;
  2. accommodation;
  3. entertainment;
  4. catering of food or beverages; or
  5. education services.

Relevant Section for Zero-Rating
S21(3)(o) of the GST Act

Certain Services (e.g. Repair and Maintenance)

Certain services comprising the repairmaintenancebroking or management of any ship.

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 (192KB).

Relevant Section for Zero-Rating
S21(3)(p) of the GST Act

Services Comprising the Management of Ship

Section 21(3)(p) of the GST Act provides that you may zero-rate the supply of services comprising the management of ship. The following are common types of ship management services and ship agency services that qualify for zero-rating.

Ship Management Services

  • Provision of technical services (e.g. the arrangement and supervision of dry-docking and repair of vessels)
  • Engagement and replacement of crew
  • Arrangement of salvage and towage of vessels
  • Arrangement and supervision of the operations of vessels
  • Arrangement for the employment of vessels
  • Construction supervision services (e.g. to ensure that the vessel is constructed according to specifications)

Ship Agency Services

  • Ship husbandry services
  • Liaisons with parties involved in the import/export of cargo, and other ancillary activities to ensure the smooth movement of cargo

Supplies of Goods to Ships

You may zero-rate a supply relating to goods (whether by sale or lease) where the Comptroller is satisfied that the goods are for:

  1. Use as stores or fuel on a ship;
  2. Installation on a ship or a ship under construction;
  3. Use in the maintenance or operation of a ship; or
  4. Sale by retail as merchandise to persons carried on a ship.

For the purposes of applying zero-rating, 'ship' refers to one which falls within the meaning of ship as explained above.

For more information on the supplies, please refer to GST Guide for the Marine Industry (479KB).

Approved Marine Customer Scheme

Under the new Approved Marine Customer Scheme (AMCS), suppliers can zero-rate supplies of goods to businesses approved under the scheme that are for:

  1. Use as stores or fuel on;
  2. Installation on; or
  3. Use in the maintenance or operation of

a commercial ship that is wholly for international travel, without the supplier having to maintain the documentary proof listed in the GST Guide for the Marine Industry (479KB).

For details, please refer to GST: Approved Marine Customer Scheme (AMCS) (193KB).

Repair and Maintenance

Under Section 21(3)(p) of the GST Act, the supply of repair and maintenance services of ship and ship parts or components is zero-rated if:

  1. Repair or maintenance is carried out on board the ship;
  2. Any part or component of the ship is removed for repair and:
    1. Reinstalled on the ship, or returned onto the ship as spare; or
    2. Delivered to:
      1. A shipyard situated in Singapore; or
      2. An approved marine customer; or
  3. Any part or component of the ship is removed and repaired by way of an exchange with an identical part or component, with the identical part or component being:
    1. Installed on the ship, or brought onto the ship as a spare; or
    2. Delivered to:
      1. A shipyard situated in Singapore; or
      2. An approved marine customer.

For details, please refer to GST Guide for the Marine Industry (479KB).

GST Relief and Documentary Waiver for Ships Temporarily in Singapore

The circular for GST relief and documentary waiver for ships temporarily in Singapore can be found here. For details, please refer to Singapore Customs' website www.customs.gov.sg.
  • The service that I provide qualifies as an international service. Therefore, I charge GST to my customer at 0%. Can I claim the GST incurred for providing the international service as input tax?

    Yes. The input GST can be claimed if you can satisfy all the conditions for input tax claim.
  • I provide repair and maintenance to a Singapore registered ship in Singapore. The ship is not a passenger harbour craft or pleasure craft. Can I zero-rate the supply of services?

    Yes. You may zero-rate your supply of repair and maintenance services if:

    Prior to 1 Oct 2011

    1. The repair or maintenance is carried out on board the ship; or
    2. Any part or component of the ship is removed for repair and reinstalled on the ship; or
    3. Any part or component of the ship is removed for repair and returned to the ship as a spare; or
    4. Any part or component of the ship is removed and replaced by an identical part or component.

    This is regardless of the place which the ship is registered.

    Effective 1 Oct 2011

    1. Repair or maintenance is carried out on board the ship;
    2. Any part or component of the ship is removed for repair and:
      1. Reinstalled on the ship, or returned onto the ship as spare; or
      2. Delivered to:
        1. A shipyard situated in Singapore; or
        2. An approved marine customer; or
    3. Any part or component of the ship is removed and repaired by way of an exchange with an identical part or component, with the identical part or component being:
      1. Installed on the ship, or brought onto the ship as a spare; or
      2. Delivered to:
        1. A shipyard situated in Singapore; or
        2. An approved marine customer.
  • I have a contract to build a ship. I will out-source part of the ship-building services to a GST-registered subcontractor. What are the GST implications?

    Your supply of the ship (i.e. contract to build) may be zero-rated. However, when your sub-contractor bills you for its ship-building services done, your sub-contractor must standard-rate the supply to you.

    Effective 1 July 2010, if you purchase goods to be used or installed on a ship under construction and the goods are delivered directly to the shipyard, the supplier can zero-rate its supply to you, provided that it can maintain the documentary requirements.

    For more information, please refer to GST Guide for the Marine Industry (479KB).

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