Singapore legislation
Regulation 4
of Income Tax (Concessionary Rate of Tax for Global Trading Companies) Regulations 2016
Regulation 4
Concessionary rate of tax
Subregulation 1
Subject to paragraph (6), tax at the rate of 5% is levied and must be paid for each year of assessment on the following income derived on or after 19 February 2020 by an approved global trading company that has been approved for that rate:
profits from any physical trading carried out by the company in the commodities specified for the company;
profits from any trading in any derivative instrument carried out by the company;
commission and fees from acting as broker in any physical trading in the commodities specified for the company;
income from the carrying on of any prescribed qualifying structured commodity financing activity, prescribed treasury activity or prescribed advisory services in relation to mergers and acquisitions, specified for the company.
Subregulation 2
Subject to paragraphs (3) and (6), tax at the rate of 10% is levied and must be paid for each year of assessment on the income mentioned in paragraph (1) of an approved global trading company that has been approved for that rate.
Subregulation 3
Despite paragraph (2) but subject to paragraphs (4) and (6), tax at the rate of 5% is levied and must be paid for each year of assessment on the following income derived on or after 19 February 2020 by an approved global trading company that has been approved for tax at the rate of 10% and has liquefied natural gas as a commodity specified for it in relation to the approval:
profits from any physical trading in liquefied natural gas carried out by the company;
profits from any trading in any derivative instrument carried out by the company, where —
the underlying commodity of the derivative instrument is liquefied natural gas; or
the trading is carried out for the purpose of hedging against any risk in any physical trading in liquefied natural gas carried out by the company, but only if the company —
has in place a system to ensure that such trading and profits are separately identifiable; and
satisfies the Minister or authorised body that it has complied with any other condition that may be imposed by the Minister or authorised body.
Subregulation 4
Paragraph (3) applies only to any income derived by an approved global trading company that is approved before 1 April 2021 during the period of its approval or extended period of its approval, where the period or extended period commences before that date.
Subregulation 5
Subject to paragraph (6), tax at the rate of 15% is levied and must be paid for each year of assessment on the income mentioned in paragraph (1) of an approved global trading company that has been approved for that rate.
Subregulation 6
Despite paragraphs (1), (2), (3) and (5), where the Minister or an authorised body substitutes, under section 43I(1AC) of the Act, the rate of tax applicable to an approved global trading company, tax at the substituted rate of 5%, 10% or 15% (as the case may be) is levied and must be paid for each year of assessment on —
in the case of paragraph (1), (2) or (5) — the income mentioned in paragraph (1); or
in the case of paragraph (3) — the income mentioned in that paragraph,that is derived by the company from (and including) the date specified by the Minister or authorised body to the company for the application of the substituted rate.
Subregulation 7
Paragraphs (5) and (6) apply only for the year of assessment 2025 and subsequent years of assessment.