Non-resident sellers and marketplaces now liable to Goods and Services Tax obligations on B2C electronic services
The city-state of Singapore introduced its Goods and Services Tax (GST) on non-resident providers and electronic marketplaces of digital or electronic services on 1 January 2020. This applies to B2C transactions – B2B should use zero-rating reverse charge. There is GST registration threshold of SGD 100,000, with a simplified electronic Overseas Vendor Registration procedure. Non-residents require a local GST agent.
The current GST rate in Singapore is 7%. Malaysia Sales Tax on digital services was introduced on the same date. Follow VAT Calc’s global VAT and GST on digital services tracker for live updates on indirect taxes on digital services.
What digital services are liable to Singaporean GST?
Income from the following services is liable to GST:
- Streaming music and video
- Online gaming
- Automated e-learning
- Search engines
- Online advertising
- SaaS or cloud-based software
Determining a GST liability on digital services
Singapore has adopted popular destination basis for GST on digital services. This means the tax becomes liable if the consumer is resident or enjoys the benefit of the services in Singapore. Providers or marketplaces may use the following as evidence of GST due in Singapore:
- Customs billing address
- IP address of device used to download/access services
- Bank transfer or credit card issuer’s address
Electronic marketplaces GST obligations
As well as direct sellers of digital services, facilitating electronic marketplaces will become liable for reporting GST on their third-party sellers. This excludes payment providers offering not service with promotion, terms & conditions or delivery of the services.
GST registration and compliance – Overseas Vendor Registration
There are GST registration thresholds for non-resident digital service providers or marketplaces:
- Singapore sales of SGD 100,000 per annum; and
- Global sales of SGD 1million.
Once over this threshold, the provider is obliged to register under the Overseas Vendor Registration process. Non-residents are obliged to appoint a GST tax representative to deal with the tax Comptroller. This includes obligations around the correct collections, reporting and payment of GST due.
GST filings are completed monthly. The return and GST payment is due by the end of the following month.
Preparing Singapore GST return can be complex. VAT Calc’s single platform VAT Filer can correctly complete any country filings with verified VAT or GST transactional data from our VAT Calculator or VAT Auditorintegrated tools.
Asia Pacific VAT on digital services
|Comments (click for details)||Rate||Date||Threshold||Comments|
|Australia||10%||Jul 2017||AUD $75,000|
|Armenia||20%||Jan 2022||AMD 115million|
|Bangladesh||5% - 15%||Jul 2019||–||B2B and B2C|
|Bhutan||7%||Jul 2021||Nu 5million|
|Cambodia||10%||Mar 2022||KHR 250m|
|China||6%-13%||N/a||Nil||Withholding VAT; B2B and B2C|
|Indonesia||11%||Aug 2020||IDR600m or 12k customers|
|Japan||10%||Oct 2015||JPY 10 million|
|Laos||7%||Feb 2022||LAK 400m|
|Nepal||13%||Jul 2022||Rupees 2m||Also 2% DST|
|New Zealand||15%||Oct 2016||NZD 60,000|
|Pakistan||2%||Sep 2021||Nil||Marketplace Withholding VAT|
|Philippines||12%||Jul 2023 ?||P 3million|
|Singapore||7%||Jan 2020||S$ 100,000|
|South Korea||10%||Jul 2015||Nil|
|Taiwan||5%||May 2017||NTD 480,000|
|Thailand||7%||Sep 2021||1.8m Baht|