Introduction
Goods and Services Tax (GST), also known as Value-Added Tax (VAT) in many countries, is a broad-based consumption tax levied on the import of goods and the supply of goods and services in Singapore. It was implemented in Singapore on 1 April 1994 to shift reliance from direct taxes to indirect taxes. Through GST, the Singapore government doesn’t have to rely solely on income taxation to raise revenue — it can also generate revenue through taxation on consumption. As a result, Singapore is able to maintain a relatively low income tax rate and remain economically competitive.
GST can also benefit businesses. If your business is GST-registered, you’re able to claim the GST paid to your suppliers, which helps reduce your business costs. GST-registered businesses generally don’t suffer a tax cost themselves — they simply act as collecting agents of GST on behalf of IRAS.
The current GST rate is 9%, in effect since 1 January 2024.
If you are dealing with older invoices or credit notes, the rate that applies is the one in force at the time of the supply: 7% up to 31 December 2022, 8% during 2023, and 9% from 1 January 2024. IRAS publishes the full history on its current GST rates page.
Categorisation of Goods and Services
Not all goods and services in Singapore are subject to GST. For GST purposes, goods and services are classified into two categories:
- Taxable supplies
- Non-taxable supplies
GST is chargeable on goods and/or services categorised as taxable supplies. Taxable supplies are further categorised as standard-rated or zero-rated. Standard-rated supplies are goods sold or services provided locally, chargeable at the prevailing rate of 9%. Zero-rated supplies are goods exported overseas, or services classified as international services under Section 21(3) of the GST Act — these are chargeable at 0%.
Non-taxable supplies are supplies where GST doesn’t apply. They include exempt supplies and out-of-scope supplies. Exempt supplies fall into three categories:
- Sale and rental of residential properties
- Financial services
- Importation and local supply of investment precious metals
Out-of-scope supplies refer to sales where the goods never entered Singapore (i.e. third-country sales) and goods in transit (for example, sales made within a Free Trade Zone or Zero GST Warehouse). Out-of-scope supplies also include private transactions — non-business activities carried out without payment or any expectation of return.
Registration Liability
Not all businesses have to, or are allowed to, charge and collect GST — a business must be GST-registered before it can do so.
To determine a business’s GST registration liability, look at its taxable turnover: the total value (excluding GST) of all taxable supplies made in Singapore — including standard-rated and zero-rated supplies, but excluding exempt supplies, out-of-scope supplies, and the sale of capital assets.
Registration is compulsory under either of two tests:
- Retrospective view: your taxable turnover for the calendar year, meaning the period from 1 January to 31 December, exceeded S$1 million.
- Prospective view: at any point in time, you can reasonably expect your taxable turnover to be more than S$1 million in the next 12 months.
Note that the retrospective test is assessed on a calendar-year basis. This replaced the older “past four quarters” test with effect from 1 January 2019, so guidance written before then is no longer reliable.
If your business’s taxable turnover hasn’t exceeded S$1 million, you may register for GST voluntarily. However, once voluntary registration is approved, the business must remain registered for at least 2 years and comply with GST regulations for that period. Voluntary registrants must also meet the GST InvoiceNow Requirement described below. Since compliance can be administratively costly, businesses not mandated by law to register are encouraged to weigh the pros and cons carefully before registering voluntarily.
When to Register
The deadline depends on which test made you liable.
Under the retrospective view, if your taxable turnover for the calendar year exceeded S$1 million, you must apply between 1 and 30 January of the following year. You will then be registered with effect from 1 March of that year.
Under the prospective view, you must apply within 30 days after the date of your forecast. Where the liability to register arises on or after 1 July 2025, your effective date of registration is 2 months from the date of your forecast. This replaced the earlier rule that registered you on the 31st day, and is intended to give businesses time to get their invoicing and systems ready before they have to start charging GST.
If you do not notify IRAS within the applicable window, you may face a fine of up to $10,000 plus a penalty equal to 10% of the GST due, and prosecution action may apply. In addition, your registration date will be backdated to when you became liable, meaning you must pay output tax to IRAS out of pocket for past sales if you cannot recover it from your customers.
Voluntary disclosure lifeline: if your business has missed its registration deadline, apply immediately and voluntarily disclose the delay. Where a business voluntarily discloses that it is late in registering, IRAS generally waives the late notification fine and penalties. You will still have to account for and pay backdated GST on your past taxable supplies, but acting proactively avoids the statutory fine.
How to Register
Applications are made online through IRAS’s myTax Portal. Whoever submits the application needs to be assigned the “GST (Filing and Applications)” digital service role in Corppass by their company’s Corppass Admin first, which is a common cause of delay for first-time registrants. The paper GST F1 form should only be used if you are unable to apply online.
Additional information or forms may be required depending on how your business is structured, for example for partnerships and joint ventures.
For overseas entities, meaning those with neither a business establishment, a fixed establishment nor a usual place of residence in Singapore, a local agent in Singapore must be appointed to handle all GST matters, including collection and payment of GST and the filing of GST returns. Different rules apply to overseas suppliers and electronic marketplace operators registering under the overseas vendor registration regime.
IRAS processes 60% of applications within 10 working days, and the remainder within 30 days, so allow time before the date you need to start charging GST.
Once GST registration is approved, the business receives a Notification of GST Registration Letter, stating the GST registration number and effective date of registration.
The GST InvoiceNow Requirement
GST-registered businesses are progressively being required to send their invoice data to IRAS through the InvoiceNow network, Singapore’s nationwide e-invoicing network. This is worth understanding before you register, because for voluntary registrants it already applies.
- From 1 November 2025: newly incorporated companies registering for GST voluntarily. “Newly incorporated” means incorporated within six months of the date they apply for registration.
- From 1 April 2026: all new voluntary GST registrants, regardless of incorporation date or business structure.
- From 1 April 2028 to 1 April 2031: new compulsory registrants and existing GST-registered businesses, phased in by the size of their annual supplies.
For voluntary registrants, the GST InvoiceNow Requirement is an additional condition of registration, not merely an administrative preference. IRAS may revoke the GST registration of a voluntary registrant that is subject to the requirement and does not comply. Factor the cost and time of onboarding an InvoiceNow-ready solution into any decision to register voluntarily.
Output Tax and Input Tax
GST should only be charged to customers from the effective date of GST registration. GST charged to customers is known as output tax.
GST-registered businesses can also claim GST paid on business purchases and expenses incurred for making taxable supplies, from the effective date of GST registration. This GST incurred is known as input tax.
The difference between output tax and input tax is the net GST payable to, or refundable by, IRAS.
Application for Exemption From GST Registration
If your business makes solely or mostly zero-rated supplies, you may apply for exemption from GST registration.
Exemption saves businesses the administrative hassle of GST collection and filing. However, an exempted business won’t be able to claim input tax, which could otherwise help reduce costs.
To apply, complete form GST F2 “Application for Exemption from Registration” and submit it with the required documents.
Exemption is granted only if both of the following conditions are met:
- More than 90% of your total taxable supplies are zero-rated; and
- The total output tax that would have been chargeable had you been GST-registered is less than the GST incurred on imports and/or purchases from GST-registered suppliers.
For more information on GST, refer to the GST section of the IRAS website.