Requirement Annual Filings for Branch Office in Singapore
Foreign companies which have set up their branches in Singapore are required to follow the statutory requirements described below:
Filing of Estimated Chargeable Income (ECI)
Branch offices are bound by law to state their sales turnover and the approximated amount of the income that is chargeable for tax, by filing the form of the Estimated Chargeable Income with the Tax Authority within the last three months of the branch office’s accounting period.
The profits to be stated should be the primary source of the branch office’s income, and other gains can be excluded from the declaration.
In the case that a branch office has no chargeable income at all, they have to submit a “NIL” ECI.
Auditing of Financial Accounts of the Branch Office
One of the main requirements of setting up a branch office includes hiring an auditor within the first three months of the registration of the branch. This is done so that the accounts can be audited on a yearly basis without any issues.
Preparing the Financial Records
The Financial Reporting Standards (FRS) which is given in the Companies Act in Singapore is the set standard that every branch must follow, and the financial accounts must be organized in compliance with the FRS. These financial accounts must also include the audit report of the loss, profits, liabilities and assets of the branch office.
Note that the FRS is united with the International FRS structure.
Filing of the Annual Accounts
Within two (2) months of the Annual General Meeting (AGM) of the parent company, a branch office should file the documents mentioned below to the Company Registrar:
- One (1) copy of the financial audit report of the Singapore branch office.
- One (1) copy of the foreign company’s financial accounts for the year in question.
- Documents that are filed out of the country under the foreign company’s authority along with the financial accounts.
In the case that the place of origin of the foreign company does not require to prepare the financial accounts and/or to hold an Annual General Meeting, it is still bound by law to set up and file the audited financial accounts in the period of seven (7) months before the end of the financial year.
Filing of the Income Tax Return
The Year of Assessment is the legal income tax year in which the tax is determined and imposed, and the preceding year is taken as the foundation for taxation.
Extension of Time for Filing the Annual Return or Holding an AGM
In the case that a parent company needs time to file the annual return or hold an AGM, the Accounting and corporate Regulatory Authority ACRA grants a one-time only protraction of around two (2) months.
Within six months and thirty days from the parent company’s end of the financial year, the authorizing power of the parent company is required to make the application.
The application for the prolonging of the annual return or holding an AGM should be submitted before the annual filing’s deadline. You would also need to pay a fee of $200 for the extension.
The form for the extension of filing time can be found here. This form can be filled out and attached with the General Lodgment form.
It is the responsibility of the employees of the branch office to take care of the annual filing. If they are unable to do so, it will be considered as a federal offence and the branch office can then be fined or prosecuted.