Singapore legislation
Regulation 3
of Income Tax (Remission of Tax for Shipping Enterprises) Order 2013
Regulation 3
Remission in relation to sale of ships
Subregulation 1
There shall be remitted the tax on the income of a shipping enterprise or an approved international shipping enterprise, as the case may be, where the enterprise is in the business of operating ships, and —
the income is derived during the period from the first day of the basis period for the year of assessment 2005 to 31st May 2011 (both dates inclusive); and
the income comprises —
in the case of the shipping enterprise, the gains derived from any of the following:
the sale of any of its ships registered (provisionally or otherwise) under the Merchant Shipping Act (Cap. 179);
the assignment by the enterprise to another person of all its rights as a buyer under a contract for the construction of any ship which is, at the time of the assignment, provisionally registered under the Merchant Shipping Act; and
in the case of the approved international shipping enterprise, the gains derived from any of the following:
the sale of any of its ships registered (provisionally or otherwise) under any shipping registry, including under the Merchant Shipping Act;
the assignment by the enterprise to another person of all its rights as a buyer under a contract for the construction of any ship which is, at the time of the assignment, registered (provisionally or otherwise) under any shipping registry, including under the Merchant Shipping Act.
Subregulation 2
The remission referred to in sub-paragraph (1) shall not apply to the gains derived by the shipping enterprise or approved international shipping enterprise, as the case may be —
from the sale by the enterprise of any ship under a finance lease treated as a sale under section 10D of the Act and the Income Tax (Income from Finance Leases) Regulations (Rg 13), under which the enterprise is a lessor; or
in the case of the shipping enterprise, from the sale by the enterprise of any ship before its delivery to the enterprise, where —
the ship is the only asset owned by the enterprise; and (ii)the enterprise is not related to any other shipping enterprise, or any approved international shipping enterprise, that carries on the business in Singapore of operating ships.
Subregulation 3
For the purpose of sub-paragraph (2)(b)(ii), a shipping enterprise is related to another shipping enterprise or an approved international shipping enterprise if —
25% or more of the total number of the issued shares of the first-mentioned shipping enterprise are beneficially owned, directly or indirectly, by the second-mentioned shipping enterprise or the approved international shipping enterprise, as the case may be;
25% or more of the total number of the issued shares of the second-mentioned shipping enterprise or the approved international shipping enterprise, as the case may be, are beneficially owned, directly or indirectly, by the first‑mentioned shipping enterprise; or
25% or more of the total number of issued shares in each of —
the first-mentioned shipping enterprise; and
the second-mentioned shipping enterprise or the approved international shipping enterprise, as the case may be, are beneficially owned, directly or indirectly, by a third person.