GST chargeable on goods delivered locally
GST-registered businesses must charge GST on goods delivered locally. If you deliver goods to the local customer of your overseas customer, you should charge GST to your overseas customer as the goods were not exported.
Exception for goods to be exported
You may charge 0% GST (zero-rate) the goods when, at the point of supply (based on the time of supply rules), you are certain that:
- The goods supplied will be or has been exported; and
- You have or will have the required documents to support zero-rating. The required documents can be found in GST: A Guide on Exports (PDF, 796KB).
- You should have custody of the goods to be exported and control over the export arrangement.
If you do not have custody of the goods to be exported or control over the export arrangement, you should charge GST as it is treated as a local supply of goods unless the Comptroller specifically allows zero-rating.
These specific circumstances are published under the section on "Indirect Export" in GST: A Guide on Export (PDF, 796KB).
Example: GST on goods delivered to local freight forwarder for export to overseas customer
You (the supplier) deliver the goods to a local freight forwarder/handling agent appointed by your overseas customer for export.
Once you leave the goods with the freight forwarder/handling agent, the goods are beyond your control. You do not have custody of the goods nor control over the export arrangement.
You can zero-rate the supply only if:
- You are certain that all the goods will be exported at the time of supply; and
- You have the documents required to support zero-rating your supplies.
In the event that you are unsure, or unable to prove that the goods will be or has been exported, you will need to charge GST to your customers, even if they are overseas customers.
For details, please refer to GST: A Guide on Exports (PDF, 796KB).
Common errors on output tax
Find out if you can zero-rate the sale of goods to your overseas customers by watching the video below. You may also view other videos on "Common GST Errors on Output Tax".
I deliver the goods to my customer locally (not to his appointed freight forwarder/handling agent) for subsequent export by my customer. Do I have to charge my customer GST for the sale of goods?
You are required to charge GST on the local sales made to your customer because when the goods are delivered to your local customer or collected by the customer himself, you cannot be certain that the goods supplied will be exported at the time of supply.
Even though you might be able to obtain the required export documents subsequently, you cannot zero-rate the supply of goods to your customer.
My overseas customer (Y) has appointed a local freight forwarder/handling agent (Z) to consolidate and export their goods. If I deliver my goods to Z for consolidation before exporting the goods to Y, can I zero-rate my supply when I invoice Y?
As you do not have custody of the goods nor control over the export arrangement, you should charge GST on the supply of goods.
However, if you are certain that all the goods will be exported at the time of supply, you can zero-rate your supply to Y.
You must also maintain all the documents required for your relevant scenario in GST: A Guide on Exports (PDF, 796KB).
I sell goods to an overseas person but the goods are delivered to a local person who is an employee of the overseas company. The goods will eventually be hand-carried out of Singapore. Do I have to charge GST on the sale of the goods?
To zero-rate, you must maintain the required documents listed in:
- GST: Guide on Hand-Carried Exports Scheme (PDF, 351KB) for hand-carried exports via Changi Airport; or
- GST: A Guide on Exports (PDF, 796KB) for situations where the Hand-Carried Export Scheme does not apply.
Zero-rating is allowed irrespective of whether the person who hand-carries the goods out of Singapore is your overseas customer, yourself, or any person appointed by anyone of you.