How To Report Cash Income On Taxes

How To Report Cash Income On Taxes – In Singapore, corporate income tax is calculated based on the previous year. Singapore’s corporate income tax rate is 17%.

This means that income earned in tax year 2020 will be taxed in 2021. In tax terms, 2021 is the year of assessment (YA), as it is the year in which your business income is taxed.

How To Report Cash Income On Taxes

To evaluate the amount of the tax, income, expenses, etc. are analyzed. during exercise. This financial year is known as the “base period.”

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The fiscal year end is determined by your company based on what best suits your business operations. It does not determine the closing of the companies’ financial year.

If you change the end of your company’s financial year, the change must be submitted to the Accounting and Corporate Regulatory Authority (ACRA) via BizFile+. It will then update your records based on the information submitted to ACRA.

Your company is taxed at a flat rate of 17% of its taxable income. This applies to both local and foreign companies.

Taxable income refers to your business’s taxable income (after deducting allowable taxable expenses) for an Assessment Year (YA).

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Your business must file 2 corporate income tax returns each year: Estimated Taxable Income (ECI) and Form C-S/Form C-S (Lite)/Form C.

Within 3 months of the end of the financial year, except for companies that qualify for exemption from filing ECI and those that are specifically not required to file an ECI

You will receive an ECI filing notification before the end of your company’s financial year*. This is a reminder to file your company’s ECI.

Learn more about ECI and whether your business qualifies for the ECI filing exemption or is specifically not required to file.

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*If your company has changed the end of its financial year, you must update the Accounting and Corporate Regulatory Authority (ACRA) through the digital financial year end change service in BizFile+. Learn more about updating company details.

You will receive the ECI filing notification before the end of your company’s financial year, starting from the year after the year of incorporation. You will not receive the notification in the year of incorporation, as most companies do not close their first set of accounts in the year of incorporation. For example, if your company was incorporated in 2021 and has a financial year ending in December, you will receive your first ECI filing notice for Assessment Year (YA) 2023 in December 2022.

However, if your company closes its first set of accounts in the year of incorporation, you must still file the ECI within 3 months of the end of your company’s first financial year, even if you have not received any notice of ECI filing. This is true unless the company qualifies for the ECI filing exemption.

Using the same example above, if your company closes its first set of accounts on December 31, 2021 and does not qualify for the ECI filing exemption, you must file the ECI for the year 2022 by March 31, 2022 (within 3 months from December 31). 2021).

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As the company’s first set of accounts covers a period of more than 12 months from the date of incorporation, its profits/losses must be attributed and reported in 2 YA.

The time apportionment basis can be used if the company cannot directly identify the income and expenses for the 2 periods.

For both scenarios, the company will receive its first ECI filing notification for the year 2023 in December 2022. There will be no notification for the year 2022.

You will receive a notice of filing of Form C-S/Form C-S (Lite)/Form C by May of each year. This is a reminder to file your company’s Form C-S/Form C-S (Lite)/Form C.

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Learn more about Form C-S/ Form C-S (Lite)/ Form C and whether your company is required to file Form C-S, Form C-S (Lite), or Form C.

You will receive the notification of filing Form C-S/ Form C-S (Lite)/ Form C starting in May of each year, starting from the second year after the year of incorporation*. You will not receive the notification in the year of incorporation, as most companies do not close their first set of accounts in the year of incorporation. For example, if your company was incorporated in 2021, you will receive your first notice of filing Form C-S/Form C-S (Lite)/Form C for Assessment Year (YA) 2023 by May 2023.

You are still required to file Form C-S/ Form C-S (Lite)/ Form C for YA immediately after the year of incorporation, even if you have not received any notification of filing Form C-S/ Form C-S (Lite)/ Form C.

Using the same example above, if your business closes its first set of accounts on December 31, 2021 and begins operations or receives income in 2021, you must file Form C-S/Form C-S (Lite)/Form C for YA 2022. before November 30, 2022.

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*This is only applicable for newly incorporated companies. Branches of foreign companies in Singapore will receive Form C-S/Form C-S (Lite)/Form C filing notifications after the first year of business. For example, if your branch is registered in Singapore in 2021, you will receive your first filing notification of Form C-S/Form C-S (Lite)/Form C for YA 2022 by May 2022.

B: You close your first set of accounts but do not start business or receive income in the year of incorporation

Check out this step-by-step guide (PDF, 2.65 MB) on how to file your first Form C-S/ Form C-S (Lite)/ Form C for YA immediately after the year of incorporation.

For all 3 scenarios, the company will receive its first notification of filing Form C-S/Form C-S (Lite)/Form C for the year 2023 by May 2023. There will be no notification for the year 2022.

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To run a business, it is important to keep good records. Companies that adopt good record-keeping practices can:

Your business must maintain adequate records of your financial transactions and retain original documents, accounting records and schedules, bank statements and any other records of transactions relating to your business for at least 5 years from the relevant Assessment Year (YA).

Access the New Business Startup Kit, an interactive e-learning guide, to learn more about your Corporate Income Tax filing obligations. This kit will provide you with the information you need for your first tax filing process, from incorporation to filing your first Estimated Taxable Income (ECI) and Form C-S/ Form C-S (Lite)/ Form C.

Company representatives responsible for the preparation and filing of corporate income tax returns and other corporate income tax matters are encouraged to view our e-learning videos.

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The first YA for your business is the YA that relates to the base period during which your business was incorporated.

It depends on the closing of the chosen financial year and the closing date of the first set of accounts. Therefore, your company’s first YA may differ from another company that is incorporated on the same day.

The company’s profits/losses must be attributed and reported in 2 annual years (i.e. annual years 2021 and 2022), as the base period for each annual year must not exceed 12 months. Therefore, the first annual year is the year 2021 and not the year 2022.

Time apportionment can be used if the company cannot directly identify its income and expenses in the 2 periods.

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Generally, the base period cannot exceed 12 months. Therefore, gains or losses must be prorated and attributed to 2 different assessment years (YA).

Your business must directly identify revenue earned and expenses incurred for each of the previous 2 years, based on the actual dates the revenue was earned and expenses incurred. If this cannot be done, the time proration method can be used, where income earned and expenses incurred are prorated based on the number of days in the applicable YA.

Generally, expenses incurred before your business begins business are not tax deductible, as they are incurred to establish the business’s operations and not “wholly and exclusively” for the production of income.

To assist businesses in business development, revenue expenses incurred 1 year before the estimated business start date are deductible for tax purposes.

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Learn more about the deductibility of expenses incurred before the start of the business and how to determine the actual start date of the business.

Your company must first authorize your staff or a third party (e.g. tax agent) on Corppass before they can access digital services on mytax. on behalf of your company. Claim tax relief for topping up your own CPF Special/Retirement Account or that of your family members to meet basic retirement needs.

The CPF cash top-up relief is provided to encourage Singaporeans and permanent residents to set aside money for retirement needs, either in their own CPF accounts or those of their family members.

Spouse/siblings must not have annual income** greater than $4,000 in the year prior to the top-up year (i.e. 2021).

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For each year of assessment, a personal income tax relief limit of $80,000 is applied to the total amount of all tax reliefs claimed (including any tax relief

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