International Tax Newsletter - Spring 2011- Singapore - New DTAs and Swap Decision

Singapore signed Double Taxation Agreements (DTAs) with the following countries in 2010:

  • Slovenia
  • Saudi Arabia
  • Panama
  • Ireland

These new DTAs will be effective only after ratification by the respective governments.

  • Under the Income Tax Act (ITA), interest, commission, fee or any other payment in connection with any loan or indebtedness borne directly or indirectly by a person resident in Singapore is deemed to be derived from Singapore. The person paying such interest or similar payment to a nonresident is required to withhold Singapore tax. However, in a recent judicial decision, payments made pursuant to interest rate swap arrangements were held not to be payments in connection with any loan or indebtedness borne by the taxpayer. As such, such swap payments are not subject to Singapore withholding tax.

International Tax Newsletter - Spring 2011 

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