Singapore legislation
Regulation 90
Regulation 90
Where deferred tax asset relates to a tax credit
Subregulation 1
This regulation applies in a case where —
the deferred tax asset in regulation 89(1) relates to a tax credit; and
the applicable domestic tax rate at which the deferred tax asset is reflected or disclosed in the financial accounts is equal to or greater than the minimum rate.
Subregulation 2
Despite regulation 89(2)(c), the amount of the deferred tax asset to be taken into account in a case to which this regulation applies for the purpose of regulation 89(1), is an amount determined by the formula A × B, where —
A is the amount determined by dividing —
the amount of the deferred tax asset as reflected or disclosed in the financial accounts; by(ii)the tax rate at which the deferred tax asset is reflected or disclosed in the financial accounts of the constituent entity in the financial year immediately before the transition year of the constituent entity; and
B is the minimum rate.
Subregulation 3
If the tax rate at which a deferred tax asset is reflected or disclosed in the financial accounts of the constituent entity changes in a financial year after its transition year (called in this regulation the re‑application year), the formula in paragraph (2) must be re‑applied to the outstanding balance of the deferred tax asset reflected or disclosed in the financial accounts at the beginning of the re‑application year to determine the amount of the deferred tax asset to be taken into account in determining the adjusted covered tax of the constituent entity for the re‑application year, and each subsequent financial year.
Subregulation 4
For the purpose of the reapplication of the formula in paragraph (2) under paragraph (3), the tax rate in paragraph (2)(a)(ii) is to be replaced with the tax rate applied in the financial accounts of the constituent entity in the re‑application year.