To support
employees who are affected by the COVID-19 pandemic, you may provide
accommodation and other types of benefits to your employees during the COVID-19
period. Whether the GST incurred can be claimed depends on the circumstances:
| Expense | Can input tax be claimed? |
|---|
Accommodation, food, transport to and from
accommodation to testing facility and thermometers provided to employees who
need to serve a Stay-Home Notice (SHN) | Employee who returns from a
business trip overseas Yes. Your employee incurred the expense to
carry out the employment duties assigned by your company. However, input tax is
not claimable if your company has been providing the same accommodation to your
employee prior to 1 Feb 2020, unless the accommodation is allowed under the
exceptions or administrative concession under paragraph 7 of the e-Tax Guide “GST:
Fringe Benefits” (PDF, 769KB).
Employee who returns from a
personal trip overseas
No. The expense is primarily incurred for the
personal benefit of your employee. The expense need not have been incurred had your
employee not travelled overseas for personal reasons. |
| COVID-19
tests and COVID-19 hospitalisation charges for employees | Medical expenses are not
claimable under Regulation 26 of the GST (General) Regulations, unless the expense is obligatory
under the Work Injury Compensation Act (“WICA”).
For example,
your employee contracted COVID-19 due to work-related exposure during a
business trip overseas. Upon return to Singapore, he is hospitalised and the
medical expenses are covered under WICA. Input tax incurred on the medical
expenses is claimable.
For COVID-19 tests for
employees required to undergo Rostered Routine Testing (“RRT”), the Government will
fund the cost of the tests until 31 March 2021.
|
| SHN expenses and accommodation provided to Malaysian workers on the
Periodic Commuting Arrangement (PCA) scheme | No. The expense is primarily incurred for the personal benefit of your
employee. For SHN expenses, the expenses need not have been incurred had your
employee not returned to Malaysia for personal reasons. |
| Accommodation
provided to Malaysian workers in light of the Movement Control Order (MCO) | Yes. Where
the Malaysian worker normally resides overseas and is required to reside in
Singapore to ensure continuity of business during the MCO period, the expense
is incurred for the purpose of your business. |
| Personal
protective equipment (e.g. masks, thermometers, hand sanitiser, etc.) to
employees | Yes.
The expense is incurred for the purpose of your business. |
| Utility
bills, telephone bills, monthly subscription fees for mobile phone and monthly
subscription fees for broadband incurred while the employee works from home (“WFH”)
during the COVID-19 period | Input tax is claimable on the business
portion of the expense incurred during the COVID-19 period. The supply should
be contracted in your employee’s name, and not any other person living in the same
household.
Utilities and home
telephone bills If you have difficulties determining the
business portion of the expenses, you may take the difference in the amount of
expenses your employee incurred before and after working from home and apportion
it equally among the working individuals in the same household. For example, if
your employee’s utilities bill has increased by $107 (inclusive of $7 GST) and
both your employee and another individual in his household work from home, you
may claim $3.50 as your input tax.
Mobile phone or broadband
subscription fees If the mobile phone subscription or broadband
subscription was used for both business and private purposes during the WFH
period, you may claim input tax: (i) For full reimbursements, based on 4/7 of
the GST incurred on the expenses.
(ii)
For partial reimbursements, based on 7/107 of the amount reimbursed or
4/7 of the GST incurred on the expenses, whichever is the lower. |
| Office
equipment for home use (e.g. printer, toner, monitor, chair) to facilitate
employees to WFH during the COVID-19 period | Your company does not own
the office equipment No, input tax is not claimable. The purchase is
primarily incurred for private purposes, as your employee can continue to use
the asset at home after the WFH period or sell it off without having to obtain
approval from your company.
If the company owns the
office equipment
Yes, the company may claim the input tax on the
purchase. |
Please refer to Covid-19 Support Measures for reliefs provided to property owners.
When exporting goods, you have up to 60 days from the time of supply to
export the goods and collate the required export documents. Due to the COVID-19
situation, if your exports are delayed due to flight limitations or shipment
delays, you are allowed up to 120 days to export the goods and collate the
required documents. This extension will also apply to hand-carried exports.
You do not need to write in for the extension to 120 days, but you must maintain
supporting documents to show that the delays arose from the COVID-19 situation
(e.g. correspondences with suppliers/ forwarders/ customers which show the
delays are due to country lockdowns, lack of flight/ shipment slots, flights/
shipments affected due to COVID-19 cases).
Business Establishment
Where
a company is not able to hold its Board of Directors meetings (during which the
strategic decisions of the company are made) in Singapore due to the travel
restriction relating to COVID-19, IRAS will consider the company as having a
business establishment in Singapore if it meets all the following conditions:
- The
company has a business establishment in Singapore before COVID-19 (e.g. due to
regular Board of Directors meetings held here);
- The
directors of the company have to attend the Board of Directors meeting held
outside Singapore or if the meeting is held via electronic means (e.g. via
video-conferencing, tele-conferencing, etc.) due to the directors being
temporarily restricted in their travel as a consequence of COVID-19; and
- There
are no other changes to the economic circumstances* of the company.
Conversely, where a company does not have a business
establishment in Singapore before COVID-19, IRAS will continue to consider the
company as not having a business establishment in Singapore, provided it meets
all the following conditions:
- The
company has to hold its Board of Directors meeting in Singapore due to the
travel restrictions relating to COVID-19; and
- There
are no other changes to the economic circumstances* of the company.
To support the claim that the company has or does not have a
business establishment in Singapore, the company should keep relevant
documentations and records (e.g. board minutes stating why the directors were
attending board meetings from their respective locations), and to provide the
relevant information to IRAS upon request.
For information on how the belonging status of a company is
determined, refer to the e-Tax Guide “GST: Guidelines on
Determining the Belonging Status of Supplier and Customer”
Fixed Establishment
Where employees of a foreign company are deployed to Singapore (e.g.
to work on a construction project) and the employees may have to remain in
Singapore due to the effects of COVID-19 including travel restrictions or the
project being delayed as a result of the circuit breaker measures introduced, such
unplanned presence of the employees will not result in the creation of a fixed
establishment in Singapore for the foreign company, provided it meets all the
following conditions:
- The
foreign company does not have a fixed establishment in Singapore before
COVID-19;
- The unplanned
presence of the employees in Singapore is due to the effects of COVID-19 and
their physical presence in Singapore up to 31 Dec 2020 is temporary;
- The
employees will leave Singapore as soon as they are able; and
- There are no other changes to the economic
circumstances* of the company.
To support the claim that there is no fixed establishment in
Singapore, the company should keep relevant documentations and records, and to
provide the relevant information to IRAS upon request.
The above positions shall not affect how permanent establishment
is to be determined for Corporate Income Tax purposes.
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*These include:
i. The principal activities and business
model of the company;
ii. The nature of the business
operations and the conduct of the business in Singapore and elsewhere; and
iii. The usual locations in which the
company operates.