A corporate taxpayer may object to an income tax assessment by filing a written notice of objection with the comptroller of income tax ("Comptroller") within two months from the date on which the notice of assessment is served. For individual taxpayers, the notice of objection must be filed within 30 days.
The taxation appeal process in Singapore involves the following stages:
a. Objection: A taxpayer who has received an income tax assessment has the right to object to it by issuing a notice of objection in writing, specifying the grounds on which the objection is made. Most objections will be settled between the Comptroller and the taxpayer, and this is followed by the issuance of a notice of the revised assessment. If both parties fail to reach an agreement, the Comptroller will notify the taxpayer by issuing a notice of refusal to amend.
b. Income Tax Board of Review ("Board"): After the notice of refusal to amend has been issued, the taxpayer has the right to make an appeal to the Board. This right of appeal is exercised by lodging a notice of appeal with the Board, followed by a petition of appeal with the detailed grounds of appeal. The Board does not have powers to go into matters not raised by the appeal. It acts by a majority decision.
c. General Division of the High Court: If either party is dissatisfied with the Board's decision as being erroneous in law or of mixed law and fact, they may appeal to the General Division of the High Court, provided the disputed tax exceeds SGD 200. The General Division of the High Court will then determine any question of law or of mixed law and fact arising in the appeal and may confirm, reduce, increase or annul the assessment determined by the Board, or make such order as it thinks fit.
d. Appellate Division of the High Court: Decisions by the General Division of the High Court on tax issues are open to appeal. Such appeals will generally be heard by the Appellate Division of the High Court unless the appeal will raise a point of law of public importance such that the case should be heard by the Court of Appeal instead. Where the amount or value of the subject matter in dispute does not exceed SGD 250,000, leave to appeal must be obtained before an appeal may be brought
e. Court of Appeal: The Court of Appeal is the highest appellate court in Singapore and its decision is final. Leave must be obtained before an appeal can be made (i) from the General Division of the High Court to the Court of Appeal directly or (b) from the Appellate Division of the High Court to the Court of Appeal. Such leave may only be granted if the appeal will raise a point of law of public importance, but the Court of Appeal is not required to grant leave under such circumstances.
Generally, the time taken to resolve tax disputes in Singapore depends on the complexity of the dispute. Based on our experience, it takes approximately three-18 months for a tax dispute to be negotiated successfully with the tax authorities. It may take up to three-six years to obtain a final determination of the case if it is litigated at the highest appellate level.
a. Start: A taxpayer may apply to the Inland Revenue Authority of Singapore (IRAS) to initiate dispute resolution through the mutual agreement procedure (MAP). An MAP is generally available to the following:
- taxpayers that are Singapore tax residents
- taxpayers who are not Singapore tax residents but have a branch in Singapore; however, such MAP applications are to be made by the taxpayers in the jurisdiction in which they are tax residents and with which Singapore has a tax treaty
Applying for an MAP does not affect a taxpayer's right to pursue other domestic legal remedies. An MAP will have to be initiated within the time limit stipulated in the MAP article of Singapore's tax treaties (e.g., three years).
b. Conduct of the proceedings: The taxpayer should inform IRAS and the relevant competent foreign tax authority if the matter is being adjudicated by a tribunal or court while the MAP process is ongoing. IRAS will then make a decision on whether to continue, cease or suspend the MAP process pending a decision by the tribunal or court.
Where the matter has been subjected to litigation and determination by the Singaporean tribunals and courts, IRAS is unlikely to depart from the determination of the Singaporean tribunals and courts.
c. Completion of proceedings: Taxpayers are not obliged to accept the outcome agreed between the competent authorities. They may withdraw the application, terminate the process or reject the agreed outcome.
If the taxpayer accepts the outcome, IRAS and the relevant foreign competent authority will proceed to exchange letters to conclude the MAP and to implement the agreement in a timely manner in accordance with domestic procedures.
d. Other actions: Singapore is a signatory to the Multilateral Convention to Implement the Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI).
For tax treaties that will be amended by the MLI, the taxpayers may request for MAP cases to be resolved through arbitration if the competent authorities are unable to reach an agreement within a specified time period.