Income Tax Act 1947 · 2020 Revised Edition · Part 6 · Capital Allowances
24. Special provisions as to certain sales
Feedback & supportLast amended by an amending law of 2021.
This section, except subsection (5), has effect in relation to any sale of any property where the buyer is a body of persons over whom the seller has control, or the seller is a body of persons over whom the buyer has control, or both the seller and buyer are bodies of persons and some other person has control over both of them, and the sale is not one to which section 33 applies.
body of persons
“body of persons” means any body politic, corporate or collegiate, any corporation sole and any fraternity, fellowship or society of persons whether corporate or unincorporate but does not include a company or a partnership;
References in subsection (1) to a body of persons include references to a company or a partnership.
company
“company” means any company incorporated or registered under any law in force in Singapore or elsewhere;
Where the parties to the sale by written notice to the Comptroller so elect —
Comptroller
“Comptroller” means the Comptroller of Income Tax appointed under section 3(1) and includes, for all purposes of this Act except the exercise of the powers conferred upon the Comptroller by sections 34F(9), 37L(7), 37M(5), 67(1)(a), 95, 96, 96A and 101, a Deputy Comptroller or an Assistant Comptroller so appointed;
the like consequences ensue for the purposes of sections 16 to 21 as would have ensued if the property had been sold —
in the case of an industrial building or structure, for a sum equal to the residue of expenditure on the construction or purchase (pursuant to a sale and purchase agreement entered into on or after 1 January 2006) of that building or structure immediately before the sale, computed in accordance with section 17;
in the case of machinery or plant, for a sum equal to the amount of the expenditure on the provision thereof still unallowed immediately before the sale, computed in accordance with section 20;
in the case of an Indefeasible Right of Use, for a sum equal to the amount of capital expenditure remaining unallowed immediately before the sale, computed in accordance with section 19D;
despite anything in section 19, where the sale is a sale of machinery or plant, no initial allowance may be made to the buyer;
despite anything in section 19A, where the sale is a sale of machinery or plant, the allowances provided under that section continue to be available as if no sale had taken place;
despite anything in section 19D, where the sale is a sale of an Indefeasible Right of Use, the writing‑down allowances provided under that section continue to be available as if no sale had taken place; and
despite anything in the preceding provisions of this section or in sections 17, 19D and 20, such balancing charge (if any) is to be made on the buyer on any event occurring after the date of the sale as would have fallen to be made on the seller if the seller had continued to own the property and had done all such things and been allowed all such allowances and deductions in connection therewith as were done by or allowed to the buyer.
In subsection (3), “Indefeasible Right of Use” has the meaning given by section 19D(1).
No election may be made under subsection (3) unless before the sale in the case of the seller and after the sale in the case of the buyer the property is used in the production of income chargeable under the provisions of this Act and unless the machinery or plant was not leased by the seller to the buyer before the sale.
No election may be made under subsection (3) for the sale of an industrial building or structure for which an option to purchase is granted or a sale and purchase agreement is entered into on or after 23 February 2010, or which is transferred on or after that date.
Subsection (4A) does not apply to a transfer of property to which section 34C(8) and (9) apply.
Where a change occurs in a partnership of persons carrying on any trade, business or profession by reason of retirement or death, or the dissolution of the partnership as to one or more of the partners, or the admission of a new partner, and where no election is made under subsection (3), any property of the partnership is treated as if the property had been sold —
to all the remaining partners and new partners of the partnership on the date the change occurs; and
at the open‑market price.
In subsection (5), “open‑market price” has the meaning given by section 20(7).