Are Dividends Taxable in Singapore?

| October 28, 2010 | 8 Comments

singapore dividends taxable Dividends are distributions by a company to its shareholders, and represent returns on a shareholder’s capital, which may be paid in cash or in kind. For instance, instead of cash, a company may pay its shareholders in the form of the company’s shares.

In Singapore, dividends have different tax classifications depending on what kind of dividends they are. Generally, dividends derived in Singapore are taxable unless they are specifically exempted under the Income Tax Act. The following information is from IRAS’s website:

Dividends exempt from tax

Dividends are not taxable if they are:

  • Foreign dividends received in Singapore on or after 1 Jan 2004. This excludes foreign source income received through partnerships in Singapore.
  • Income distributions from unit trusts and real estate investment trusts (REIT), that are authorised under Section 286 of the Securities and Futures Act (excludes distributions out of franked dividends) on or after 1 Jan 2004.
  • One-tier exempt dividends from companies under the one-tier corporate tax system.

How to report dividends

You need to declare the taxable dividends under ‘other income’, and the amount of tax deducted (please refer to your dividend vouchers/statements) under ‘Singapore tax deducted at source’ in your tax form.

However, if you hold a Singapore NRIC, the relevant companies paying the dividends will provide information on your taxable dividends to us. You need not declare the dividends (this does not apply to dividends received by joint account holders or where shares are held through nominees).

Type of dividends
Need to declare?
Singapore dividends from approved CPF investment Scheme agent banks as shown in the Annual Dividend Statement (ADS)

No

Singapore dividends from Central Depository Pte Ltd (CDP)

No

Singapore dividends from Supplementary Retirement Scheme (SRS)

No

NTUC Fair-Price dividends

No

Dividends from share buyback through Special Trading Counters (CTC)

No

Dividends from Private Companies

No

Any other dividends not included above

Yes

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Category: Singapore Stock Market Help

About the Author ()

John Tan has been Vice President of BlueTrust Investments Corporation for 6 years since the mid-90’s. He has since moved on, to be a professional full-time trader.

Comments (8)

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  1. Rosa says:

    Hi, what if you’re not Singaporean or PR? are the dividends taxable. How would you go about declaring it?

    thks

  2. Roy says:

    For a stock purchase to be eligible for dividend payout, is there a time period that we must adhere to?
    Is it prior to dividend announcement date or exercise date?

    • ProfitFan says:

      You just have to own the stock prior to the exercise date. However, it’s not free money, because the stock price will drop by an equal amount immediately after the dividend exercise date.

      • Nathaniel says:

        It depends on your approach in stocks investments. If you are holding for the long term, a drop in price after XD should not be an issue to you, and in this case it is free money. If the fundamentals of the company is strong, share prices will increase to the price when it is in CD state or even higher. A good example can be those defensive stocks such as Singapore Post, SPH and REITS….

  3. Vonn says:

    Dividends are not taxable to any individual who buys in Singapore as the companies have already been taxed. that is my understanding. check out sgsharematket.com for a list of top dividend stocks in Singapore.

  4. Vonn says:

    Dividends are not taxable to any individual who buys in Singapore as the companies have already been taxed. that is my understanding. check out sgsharemarket.com for a list of top dividend stocks in Singapore.

  5. hari says:

    Interesting info you will have given, very good putting up.

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