PE and Double Tax Deduction for Internationalisation

Raffles Place by Nan-Cheng Tsai on Flickr https://flic.kr/p/bvVmdw

As more and more Singapore companies are involved in international operations, they’re getting prepared to face challenges on tax issues such as permanent establishment (PE). PE refers to a fixed place of business through which the business of an enterprise is wholly or partly carried on and to determine where the business profit is to be taxed.

The concept of a PE is to allocate business profits between countries in order to avoid double taxation. PE issues may arise when Singapore companies market and sell its products overseas such as E-commerce and market research in overseas.

Singapore governments introduced double tax deduction for internationalisation (DTDi) which allows a business to claim a 200% tax deduction on qualifying expenditure for the following:

(i) Overseas business development trips and missions;

(ii) Overseas investment study trips and missions;

(iii) Overseas trade fairs, and;

(iv) Local trade fairs approved by IE Singapore or Singapore Tourism Board.

Read more: “Grasp: PE, Seize: The World – Be on Top of Permanent Establishment as You Internationalise” – Source from SIATP – https://siatp.org.sg/…/pe2016-siatpmbers.pdf

For more information on Double Tax Deduction: https://www.iras.gov.sg/…/Double-Tax-Deduction-for-Internationalisation-Scheme/

Image Raffles Place by Nan-Cheng Tsai.