Tax

As a leading tax practice operating within the Singapore legal arena, we possess a comprehensive understanding across every facet of Singapore’s tax landscape, including income tax, goods and services tax (GST), stamp duty, property tax, and intricate tax treaty matters. Our breadth of knowledge positions us to offer our clients robust support across all tax-related challenges, encompassing tax advisory services, transaction tax guidance, tax dispute resolution, and tax litigation support.

Rajah & Tann's Tax Practice commands a comprehensive understanding across the full spectrum of tax matters, including income tax, goods and services tax (GST), stamp duty, property tax, and tax treaty issues, which enables us to provide clients with holistic assistance across the full spectrum of taxation concerns.

The firm’s Tax Practice is led by partner Vikna Rajah. Drawing upon insights from direct work experience with the Singapore tax authorities, we strive to provide a rich and comprehensive suite of tax advisory and dispute resolution services to businesses and individuals within and outside Singapore.

Tailored Tax Advisory and Dispute Resolution Services

We offer bespoke tax advisory and dispute resolution services, ensuring comprehensive support for our clients' diverse needs.

1. Dispute Resolution

 As the leading tax and dispute resolution firm in Singapore, we have extensive experience in tax dispute resolution and litigation and offer robust support through negotiations with the Singapore tax authorities and representation across all judicial levels, from the Board of Review to the Supreme Court of Singapore. We have a successful track record of overturning IRAS’ assessments and resolving multi-million-dollar disputes with IRAS. Notably, we served as lead counsel in the only two civil tax cases before the High Court in Singapore in 2023, including the landmark case Herbalife International Singapore Pte Ltd v Comptroller of Goods and Services Tax [2023] SGHC 54, which was also the second-ever GST case to reach the Singapore High Court, with far-reaching implications on how IRAS will tax the multi-level marketing industry moving forward.

2. Tax Advisory

 Regularly instructed by multinational companies, premier law firms and Big 4 accounting firms, our practice delivers dynamic and strategic tax advisory services to clients from a broad spectrum of industries, including banking and finance, shipping, insurance, fund management, healthcare, property development, education, the media and beyond.

We advise on the tax-efficient structuring and planning of clients’ operations and investments, the application of tax incentives and tax compliance. Leveraging a deep understanding of cross-border tax matters, we offer seamless and effective tax solutions that empower our clients to confidently expand their global footprint. 

Additionally, we assist clients in understanding and navigating the tax implications of their commercial transactions. Drawing from our international exposure to cross-border transactions, local tax law knowledge and commercial acumen, we provide practical advice that addresses the tax implications of our clients’ transactions.

3. Income Tax

 We provide comprehensive guidance on an array of income tax issues, including tax residency, source and remittance rules, the capital and revenue divide, heads of charge and exemptions, withholding tax, deductions and allowances, transfer pricing, accounting, reporting and payment, tax avoidance and tax offences, etc.

4. Goods & Services Tax (“GST”)

 We advise on a holistic range of GST issues, including the scope of taxation, taxable persons, supplies, input tax, zero-rated supplies, exempt supplies and exclusions, imports, accounting, reporting and payment, tax avoidance and tax offences, among other key areas. 

We have advised our clients in relation to a wide spectrum of transactions, including the sale of businesses, the supply of services, the zero-rating of international services, sponsorships and gifts, research grants, the applicability of special GST schemes etc.

5. Stamp Duty and Property Tax 

We guide our clients in navigating the full spectrum of stamp duty issues, including the scope of taxation, chargeable instruments, relief and remission, property market measures, assessments, tax avoidance and tax offences, etc. We also have a deep understanding of various types of commercial and real estate transactions and the applicable exemptions.

Additionally, we advise on a diverse range of property tax issues, including the scope of taxation, assessable property, valuation, the valuation list, assessments, and tax offences.

Notable Cases & Transactions

Civil Tax Litigation

• Successfully acted for Herbalife International, one of the world’s largest global multi-level marketing corporations, before the Singapore High Court, which reversed the GST Board of Review’s decision on whether discounts granted to direct sellers constitute consideration for services supplied by them. The High Court’s landmark decision in Herbalife International Singapore Pte Ltd v Comptroller of Goods and Services Tax [2023] SGHC 54 has far-reaching implications on how IRAS will tax the multi-level marketing industry moving forward. The case is also notable for being the second GST case in Singapore’s history to reach the High Court. Having attracted substantial media coverage, the case was discussed in the Singapore Parliament, where Deputy Prime Minister and Minister for Finance, Mr Lawrence Wong took the opportunity to comment on it. This case was also recognised as “Impact Case of the Year” by International Tax Review.

• Successfully acted for an investment holding company which actively traded a portion of shares in its portfolio, by persuading IRAS to segregate the different shares based on their holding periods, resulting in approximately S$50 million of investments being classified as capital in nature.

• Successfully acted for a wholly-owned subsidiary of a US-listed American company on the deductibility of certain platform contribution transaction payments made under a cost-sharing arrangement amounting to over S$200 million.

• Acted for a Singapore company before the Income Tax Board of Review and Singapore High Court on whether a cement silo is considered a plant for capital allowances purposes.

• Advised a Chinese video game developer and publisher on whether payments amounting to approximately US$100 million made in return for game software under certain agreements between related parties would qualify for a capital allowance claim in Singapore.

• Acted for a data centre company in a GST dispute with IRAS concerning the importation of servers and leaseback of such servers to overseas customers, specifically whether the leasing services could be zero-rated.

• Successfully acted for a Singapore real estate development company by persuading IRAS that the company was not a property holding entity, thereby avoiding the imposition of additional conveyance duties with respect to an ownership change in a joint venture for a residential development worth S$1.1 billion.

• Successfully acted for a commodity trading company by persuading IRAS to reverse its initial position and allow deductions on the license fees made to miners based outside Singapore which amounted to over US$900,000.

• Acted for a leading Chinese software analytics company in respect of a capital allowances claim for the purchase of intellectual property rights and dispute with IRAS concerning the payment of royalties to a related party.

• Successfully acted for a non-profit professional institute in relation to an input tax claim arising from the construction of a S$50 million student hostel. Persuaded IRAS to reverse their initial view that the input tax claim of approximately S$4 million was not claimable, leading to the input tax claim being allowed in full.

• Successfully represented an aircraft leasing company in a dispute with IRAS in relation to an aircraft held under foreign trusts by two of the company’s Singapore subsidiaries. Persuaded IRAS to reverse its advance ruling and find that the Singapore subsidiaries qualify for the concessionary income tax rate available to qualified lessors under the ITA.

• Acted for a passive investment holding company for the purpose of a trust, the settlor and beneficiaries of which were all non-tax residents of Singapore. Persuaded IRAS against taxing the interest income from the bonds as well as the dividend income from the share counters held by the trust.

• Acted for a telecommunications service provider in relation to IRAS’ disallowance of financing and corporate costs that were included in the valuation of certain fixed assets for capital allowance purposes.

• Acted for an automotive technology supplier in an advance ruling application to IRAS on whether Franchise Fees derived by a Singapore incorporated holding company from the acquisition of IP rights and other intangible properties are sourced in Singapore.

• Acted for a growing, independent and Africa dedicated energy business in an income tax dispute with IRAS regarding the sourcing of income derived by the sale of petroleum products outside of Singapore.

Criminal Tax Litigation

• Acted for an individual in the first GST evasion case to be decided under the new sentencing framework laid down by the High Court in Public Prosecutor v Pua Om Tee (MA 9019 of 2021). Successfully managed to reduce the proposed term of imprisonment by 6 months.

• Acted for the accused in a case involving fraudulent GST evasion by under-declaration of the value of imported goods, where the Courts imposed a fine of five times the value of the tax evaded, half the amount the Customs Prosecutor was seeking.

• Acted for the accused in relation to charges under section 37J of the ITA and successfully reduced the charge of willfully with intent to obtain a Productivity and Innovation Credit (“PIC”) cash payout to a lesser charge of providing false information without reasonable excuse to obtain a PIC cash payout.

• Acted for the Chief Executive Officer of an international trust services provider, and its subsidiary, in a dispute regarding underreported gains and payments of benefits-in-kind respectively which led to savings of approximately S$450,000.

• Acted for two accused persons who undertook personal investments in a company that was in the business of repair of ships, tankers and other ocean-going vessels and genuinely believed that the gains from those personal investments were not taxable in the hands of individual taxpayers. Therefore, they did not include the gains in their income tax returns. We successfully obtained a landmark sentence of a two-week imprisonment per charge to be run concurrently, which is significantly lower than the usual sentencing precedent of 3 to 4 weeks’ imprisonment per charge.

Tax Advisory

• Advised VinFast Auto Ltd., Vietnam’s leading automotive manufacturer with a revenue of US$339.7 million in 2023, on the Singapore tax implications of its business combination with Black Spade Acquisition Co., a special purpose acquisition company (SPAC) which valued VinFast Auto Ltd. at approximately US$23 billion, and the listing of VinFast Auto Ltd. on the Nasdaq Stock Exchange following completion of the business combination. The transaction was regarded as the largest Vietnamese M&A transaction since records began in 1980.

• Advised Link Real Estate Investment Trust, the largest investment trust in Asia, on tax structuring alternatives to achieve tax efficiency in a $2.16 billion acquisition of two Singapore shopping malls, which led to the biggest property deal in Southeast Asia for 2023.

• Advised a leading worldwide container transportation and shipping group on the Singapore tax aspects of the reorganisation of the two different freight receivables securitisation facilities of non-interest-bearing trade receivables amounting to approximately US$1.2 billion originated by its subsidiaries.

• Advised a global video-sharing social networking service company on transfer pricing considerations arising from an expense sharing and cost allocation arrangement for user growth and data cloud services and draft the agreements implementing such an arrangement.

• Advised a global automobile manufacturer specialising in high-performance spots cars, SUVs and sedans on a large-scale structuring exercise that the manufacturer is considering in relation to the dealership and retail operations within Singapore.

• Advised an American multinational banking and financial services corporation on the stamp duty treatment of various documents such as the credit support deed and the variation margin credit support deed as well as the civil and criminal liabilities of a securities agreement associated with Lombard Loans.

• Advised a Singaporean multinational banking and financial services corporation to advise on Singapore tax structuring considerations for the commercialisation of IP assets governing tech utilities, banking utilities and banking services.

• Advised a specialist tax advisor for the complex tax issues arising from the judicial management and eventual winding up process of one of Asia’s top oil traders with assets amounting to approximately S$346 million.

• Advised a software company on transfer pricing considerations arising from an expense sharing and cost allocation arrangement for user growth and data cloud services and drafted the agreements implementing such an arrangement.

• Advised on the tax treatment of the gains derived from the disposal of shares in a property holding company incorporated in India.

• Advised an American multinational banking and financial services corporation on permanent establishment risks arising from activities performed by employees in Singapore and the impact of Pillar 1 and Pillar 2 under BEPS 2.

• Advised an American multinational investment company on a tax efficient structure and implications arising from the repatriation of income and disposal of shares as well as the applicability of any Singapore tax filing requirements.

• Advised a Spanish multinational financial services company on the tax residency, withholding tax and anti-avoidance implications arising from a senior facilities agreement.

• Advised the Singapore subsidiary of a Chinese multinational technology company on the foreseeable relevant standard of certain information requested by the Spanish tax authority.

• Advised the Indonesian subsidiary of an American multinational financial services corporation on the characterisation of service fees paid by the Indonesian subsidiary to the Singapore subsidiary.

• Advised one of Asia’s largest oil trading and ship management companies on the tax treatment of insurance premiums with respect to certain group insurance policies purchased for its employees. Such policies include group personal accident policy, group term life policy and group hospital & surgical insurance policy.

• Advised on tax aspect of the issuance of the A$75 million Series 2019-1 Class A Principal At-Risk Variable Rate Notes due 2022 by Orchard ILS Pte, Ltd., a special purpose reinsurance vehicle, with Insurance Australia Limited, IAG Re Labuan (L) Berhad, Labuan F.T., Malaysia and IAG Re Singapore Pte Ltd on behalf of Insurance Australia Group Limited, as the ceding insurers.

• Advised on the tax treatment of a Dutch limited partnership in Singapore holding IP rights, including whether the limited partner would need to pay tax on income earned by the general partner outside Singapore, and whether the IP income would be considered to be sourced in Singapore.

• Advised a refreshments supply company in a property tax dispute with IRAS, specifically on whether two properties joined by a bridge should be assessed separately and whether the rental comparison method or the contractor’s test method should be used.

• Advised an Australian bank and financial services provider on Singapore income tax, withholding tax and goods and services tax implications for a complex securitisation arrangement that involved between originators situated in Australia, Singapore and New Zealand and the trustee that is controlled and managed in Australia.

• Advised a Cambodian real estate developer on the Singapore tax implications of a direct investment from China to Cambodia which involved Singapore intermediate holding companies, including the classification of certain hybrid instruments and the economic substance rules in various Crown Dependencies.

• Advised a vehicle manufacturer on whether GST should be charged both upon the completion of the manufacturing and the completion of assembly.

Accolades 

Our Lead Partner, Vikna Rajah, has been consistently recognised as “Highly Regarded” in “Tax Controversy” by International Tax Review World Tax 2021 – 2023 and a “Litigation Star” by Benchmark Litigation APAC 2020 – 2023. He is ranked as a “Distinguished Practitioner” in tax by Asialaw Profiles 2020 – 2023, a “Leading Individual” in tax by The Legal 500 APAC 2017 – 2024, and a leading tax lawyer by Chambers and Partners APAC 2018 – 2024. He is praised in legal directories as being “best of the best”, an “experienced litigator” with “extensive tax knowledge”, and “an extremely intelligent man” who is “excellent to work with”. He also combines “very deep technical expertise with acute commercial acumen”, while “carefully listening to his clients and putting himself in their shoes”, with the ability to “make the impossible possible”.

On the other hand, our Tax Practice is ranked “Band 2” for Tax by Chambers and Partners APAC 2024 and The Legal 500 APAC 2024. It is recognised as “Highly Recommended” for Tax in Asialaw 2024. The team’s landmark win in the second-ever GST case before the Singapore High Court, Herbalife International Singapore Pte Ltd v Comptroller of Goods and Services Tax [2023] SGHC 54, was recognised as “Impact Case of the Year” by the International Tax Review. The team also clinched Singapore’s Tax Disputes and Litigation Firm of the Year by the International Tax Review 2017.

The Tax Practice has been lauded as having “an excellent level of knowledge and experience in dealing with difficult tax issues”, with a team of “experienced and pragmatic tax lawyers” who are “very visible in tax litigation” and provide “a strong transactional tax offering, strengthened by multidisciplinary expertise in the insurance, capital markets, banking, and technology sectors”. It is also well known for providing “clear and concise advice” and is praised for its “very good insight into the local tax authority’s way of thinking and excellent communication skills”. 

Contact

For more details, please reach out to Vikna Rajah, Head of the Tax, Trust & Private Client Practices at vikna.rajah@rajahtann.com.