Paying taxes on time is critical. Business owners in Singapore need to pay their taxes within one month from the NOA or Notice of Assessment before the due date. Singapore companies that fail to pay their tax will be charged a 5% penalty on overdue tax, with an additional 1% every month if the tax remains unpaid for sixty days following the initial penalty up to a maximum of 12% unpaid tax.
However, due to the global COVID-19 outbreak, taxpayers are having difficulties paying their taxes on time. Fortunately, the Singapore government has been introducing a series of support measures to help individuals and businesses ease their cash flow. During this challenging period, the Inland Revenue Authority of Singapore or IRAS also assists and offers taxpayers tax certainty. It sets out tax guidelines for taxpayers who may be impacted by the pandemic. This article guides you through what you need to know about IRAS longer instalment plan for corporate income tax.
Circumstances that Allow an Appeal for a Longer Instalment Plan
IRAS may provide proper payment arrangements like a longer instalment plan to corporations that cannot pay their taxes because of unexpected or extenuating situations. These financial difficulties include the following:
For individuals: Loss of job or business failure, reduction in business cash-flow or income, unsteady source of income or high medical costs incurred for himself or herself or his or her immediate family members.
For businesses: Slow collections, sales reduction or increase in overheads
How to Arrange For a longer Instalment Plan
IRAS will only grant instalment plans through GIRO. Business owners can appeal for the plan through the “Apply for Payment Plan” section by accessing the e-Service at myTax Portal with their Singpass, CorpPass or IUA (Unique Account).
Those who already have an existing GIRO account can customise their payment plan in two easy steps:
- Step 1: Cancel their existing plan
- Step 2: Arrange a new payment plan
Alternatively, they can refer to the step-by-step guide prepared by IRAS for more details.
Those who do not have an existing GIRO account for property tax and individual income tax can customise their payment plan with the following steps:
- Step 1: Apply for a GIRO payment with POSB/DBS or OCBC bank through myTax Portal
- Step 2: Arrange for a new payment plan
For more information, they can refer to the IRAS’ user guide.
On the other hand, those who do not have an existing GIRO account for corporate income tax and goods and services tax could follow the steps below:
- Step 1: Fill up and complete the Master GIRO form hardcopy and submit it to IRAS. IRAS will not accept forms in soft copy with e-signatures
- Step 2: Send in the payment proposal online within the same date
Upon submission, IRAS will review the request and notify the applicants of the result within fifteen working days. In some cases, applicants will be asked for more details to better understand and evaluate their circumstances.
Applicants whose payment plan is accepted must comply with the set schedule. Failure to do so may cause IRAS to cancel their plan and may take actions to recover the tax.
Other Available Financial and Support Services
Business owners who need other forms of assistance specific to their situations may reach out to the following agencies:
- For employment support: WSG or Workforce Singapore Careers Connect
- For enterprise support: Enterprise Singapore
- For social assistance: Social Services Offices, MSF or Ministry of Social and Family Development
Getting Help from Professional Accounting Services Provider in Singapore
Apart from helping companies prepare an accurate statutory report and stay compliant with the latest accounting regulations, professional accounting firms Singapore helps businesses access various government sources or private financial relief and recommend effective strategies to save money and increase revenue during hard situations. They help businesses handle their resources wisely and optimise their cash flow by determining profitable and unprofitable ventures.