Singapore legislation
Clause 11
Clause 11
New section 43E
The principal Act is amended by inserting, immediately after section 43D, the following section:“Concessionary rate of tax for headquarters company43E.—
Notwithstanding section 43, the Minister may by regulations provide that tax at the rate of 10% or such other concessionary rate shall be levied and paid for each year of assessment upon such income as the Minister may specify of an approved headquarters company derived by it on or after 1st September 1986 from the provision of such qualifying services as may be prescribed to its offices, associated companies and other persons where such offices, associated companies and persons are outside Singapore; and those regulations may provide for the deduction of losses otherwise than in accordance with section 37(2).(2) The concessionary rate of tax referred to in subsection (1) shall apply to an approved headquarters company —
in respect of any qualifying service only where the qualifying service and the office, associated company or person to whom the service is rendered have been approved in relation to that headquarters company for such concessionary rate; and
subject to such conditions as the Minister or person appointed by him may impose.(3) For the purposes of this section —“approved” means approved by the Minister or such other person as he may appoint;“associated company”, in relation to an approved headquarters company, means a company —
the operations of which are or can be controlled, either directly or indirectly, by that headquarters company;
which controls or can control, either directly or indirectly, the operations of that headquarters company; or
the operations of which are or can be controlled, either directly or indirectly, by a person or persons who control or can control, either directly or indirectly, the operations of that headquarters company:Provided that a company shall be deemed to be an associated company in relation to an approved headquarters company if —
at least 25% of its issued capital is beneficially owned, either directly or indirectly, by the approved headquarters company; or
at least 25% of the issued capital of the approved headquarters company is beneficially owned, either directly or indirectly, by the first-mentioned company;“headquarters company” means a company carrying on the business in Singapore of providing management, technical or other supporting services to its offices outside Singapore or to its associated companies outside Singapore.”.