Taxes on Investments in Singapore

Individuals who derive income from investments in property, shares, unit trusts, fixed deposits etc. in Singapore need to pay income tax, unless the investment is specifically exempted under the Income Tax Act.

Investment Income from Properties

Rental Income

Rental income refers to the full amount of rent and related payments you receive when you rent out your property. This includes rent of the premises, maintenance, furniture and fittings.

Rental income is subject to income tax. This means that any profit or net amount left once you have added together your rental income and deducted any allowable expenses is taxable .

Gains from Sale of Property

Generally, the gains derived from the sale of a property in Singapore are not taxable as it is a capital gain. However, the gains may be taxable if you buy and sell property with a profit seeking motive.

For details, please refer to:

Investment Income from Shares/Unit Trusts

Dividends are profits you receive from your share of ownership in a company, which may be paid to you in cash or in kind. For example, a company may pay its shareholders dividends in the form of the company's shares.

Effective 1 Jan 2008, Singapore resident companies can issue one-tier tax exempt dividends. This means shareholders will not be taxed on this dividend income. However, dividends received from shares in co-operatives are taxable.

Generally, income distribution from Real Estate Investment Trusts (REITs) and unit trusts are exempt from income tax. This excludes distribution derived by individuals:

a. Through a partnership in Singapore; or
b. From the carrying on of a trade, business or profession.

Dividends are taxed in the year in which they are declared payable.

For details, please refer to what dividends are taxable, what are not .

Investment Income from Fixed Deposits

The interest received from deposits with approved banks or licensed finance companies in Singapore is not taxable.

Interest from debt securities (e.g. bonds) is also not taxable unless it is derived from:

a. A partnership in Singapore; or 
b. From the carrying on of a trade in debt securities.

For details, please refer to what interests are taxable, what are not .

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