What is a Certificate of Residence?
The Certificate of Residence (COR) is a letter issued by IRAS to certify that the company is a tax resident company in Singapore. In the view of IRAS, a tax resident in Singapore is one whereby the control and management of the company must be exercised in Singapore.
Why you need to apply COR?
Singapore Companies that derived income from foreign company or persons will be tax base on the foreign jurisdiction such as withholding tax. Often, the tax rates may be higher compare to Singapore tax rates.
Under the double tax agreements, treaty partner (Countries) may provide lower tax rate or tax exemption to the qualifying companies.
The Company will have to apply for COR and submit to the treaty partner to claim the tax benefits.
Non qualifying companies
- Nominee Company: Nominee Companies are not eligible to apply for COR as the beneficial owner did not receive the income directly from the treaty partner. The income is merely received by the nominee company which basically hold the shares on behalf of the beneficial owner.
- Foreign Owned Investment-holding Company: A foreign owned company is a company whereby 50% or more of the shares is owned by foreign company or individual. The company is not eligible to apply for COR as the income derived from a passive source and only foreign sourced income is received. IRAS may give exception to the company if they can prove that the control and management are in Singapore, and there is valid reason to set up a company in Singapore.
- Non-Singapore Incorporated Company: The fact that the company is not control and manage in Singapore. IRAS may give exception if they can prove otherwise.
How to apply for COR?
COR can be applied via the Tax Portal in IRAS for the current year or up to 4 years back. The Company will need to authorize its staff or third party agents to apply on behalf of the company.
Generally, IRAS will process the application within 7 working days and mail out the COR to the company’s registered address. Soft copy will be available in the Tax portal after the application is processed.
At Ace Success, we can apply for the COR on your company’s behalf. We will require the following information from you:
- Company Bizfile
- Confirmation that the company is not dormant
- Confirmation that the company is not an investment company or receiving only foreign sourced income
- Confirmation that the control and management is in Singapore
- Calendar year for which the COR is required
- Tax treaty country
- Nature of the income (eg. Interest, royalty, commission, management fees, consultancy fees, Service fees, Dividend)
- Amount of Income
- Date of remittance
At Ace Success, we aim to be a one-stop service provider for all your corporate needs in Singapore. Our range of services include Company Incorporation in Singapore, Accounting, Annual Compliance, Corporate Secretary, Corporate Tax, Individual Income Tax, Business Solutions, Nominee Director, GST Registration, Auditing and Cloud Accounting.
We adopt a straightforward approach to cater to your business needs. We are dedicated to understanding your current back-end business process and strive towards achieving the best suited solutions. Get in touch with us to know more about our services.