IRAS updated its corporate tax compliance guidance, introducing the timely and accurate filing of the Form for Reporting Related Party Transactions (RPT Form) as a new area of ongoing audit focus while reaffirming its risk-based approach to monitoring tax compliance.
The Inland Revenue Authority of Singapore (IRAS) has updated its Getting Companies to Comply guidance, adding the timely and accurate filing of the Form for Reporting Related Party Transactions (RPT Form) as a new ongoing area of corporate tax compliance focus.
Companies are required to complete the RPT Form where the value of related party transactions disclosed in their financial statements for the relevant financial period exceeds SGD 15 million. The form, which forms part of the Corporate Income Tax Return (Form C), provides IRAS with information to assess transfer pricing risks. Companies are encouraged to review their internal processes and controls to ensure that RPT Forms are filed accurately and on time.
The overall guidance outlines IRAS’ corporate tax compliance strategy, which combines risk-based and random audits supported by data analytics and other tools to identify non-compliance across industries.
Upcoming compliance programmes will focus on claims under the Enterprise Innovation Scheme (EIS) and compliance with withholding tax obligations. IRAS encourages businesses that identify errors to make voluntary disclosures, which may qualify them for reduced penalties.
IRAS’ ongoing compliance efforts continue to cover timely filing of corporate income tax returns, claims for private or non-deductible expenses, the classification of income and expenses subject to concessionary tax rates, recognition of income from construction contracts, the tax treatment of property disposal gains, digital economy businesses, deductibility of interest expenses and borrowing costs, and related party transaction reporting.
The guidance also highlights recurring areas of non-compliance, including the abuse of tax exemption schemes, incorrect capital allowance claims, related party services that are not priced at arm’s length, the tax treatment of investment dealing companies, and companies that recommence business after being exempted from filing corporate income tax returns without notifying IRAS.
IRAS emphasises the importance of maintaining proper business records, meeting filing obligations on time, voluntarily disclosing errors, and reporting suspected tax evasion as part of its broader strategy to promote voluntary compliance and safeguard Singapore’s tax system.
