Ever wondered what a dormant company is? We hear you. In this blog post, we’ll answer some of the frequently asked questions people have about dormant companies in general and the responsibilities of dormant companies in Singapore in particular. If your company did not have any transactions or income after its Singapore company incorporation, will you still be required to file anything?
First, let’s define what a dormant company is. A company is considered dormant if it didn’t carry on business and didn’t receive any income for an entire year or ‘basis period’. In Singapore, the Inland Revenue Authority of Singapore (IRAS) assesses the amount of tax based on the income and expenses that a company received during a financial year. The said financial year is also referred to as the ‘basis period’.
For example, if your company didn’t have any transactions and didn’t generate any income for 2014, it will be considered a dormant company in the following Year of Assessment (YA) which, in this case, is 2015.
My company is dormant. Am I required to file income tax return?
Yes, dormant companies in Singapore are still required to file their income tax return. The only time a dormant company can be allowed to skip filing its income tax return is when it is granted with a Waiver of Income Tax Return Submission (Form C-S/C).
You can file the income tax return of your dormant company in two ways. The first option is e-Filing through mytax.iras.gov.sg by accomplishing the File Income Tax Return (Form for Dormant Company). In order for you to e-File, you must first authorize yourself as an ‘Approver’ through e-Services Authorisation System (EASY), an online portal where companies and organisations can authorize employees or a third party to access e-Services on their behalf. Take note of your company’s tax reference number along with your SingPass or IRAS pin as you will need these in completing the online form. Once you are authorized as an ‘Approver’, you can simply log in to mytax.iras.gov.sg, fill out the form, and submit the completed form.
The second option is by submitting a hard copy of the Form C-S/C to IRAS. Take note that for dormant companies, you only need to fill out the first page of the form. Since the company did not have any business operations or income for the entire base period, you are also not required by IRAS to submit financial accounts.
How can I apply for a Waiver of Income Tax Return Submission (Form C-S/C) for my dormant company?
If you foresee that your dormant company will not have any business transactions or income in the next two years, you may apply for it to be relieved of its duty to file income tax return. Similar to most government transactions, the application for a Waiver of Income Tax Return Submission (Form C-S/C) can be processed via e-Service or via hardcopy application. In case your dormant company is GST registered, you must first cancel the GST registration before you apply.
If you choose to apply for a Waiver of Income Tax Return Submission (Form C-S/C) via e-Service, make sure to authorize yourself as the ‘Approver’ for Corporate Tax Matters though EASY.
Should you prefer hardcopy application, simply fill out the ‘Application for Waiver of Income Tax Return (Form C/ Form C-S) Submission by a Dormant Company’ form. Then send the accomplished form to IRAS at 55 Newton Road, Revenue House, Singapore 307987.
The waiting time for the result is up to two months from the date IRAS received your application. Once your dormant company is granted the waiver, you will no longer be required to file income tax return and Estimated Chargeable Income (ECI). Wondering if you should renew your waiver on a yearly basis? The answer is no. IRAS will no longer require you to file income tax or renew your waiver as long as your company stays dormant.
My dormant company is ready to commence business again. What should I do?
You simply need to inform IRAS within a month after your dormant company starts doing business again or receiving income. You can do this by accomplishing a ‘Request for Income Tax Return (Form C-S/ C)’ and ‘Notification of New Financial Year End’ form and submitting it to IRAS.
Seeking Support in Filing Taxes
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