GST in Singapore: When Overseas Vendors Must Register and Collect Tax

Foreign companies supplying goods or services to Singapore customers are subject to specific obligations under the country’s Goods and Services Tax (GST) regime. The extension of GST to overseas vendors has created a structured framework for registration, collection, and reporting.

For cross-border businesses, understanding when these obligations arise and how to comply is essential to maintaining access to the Singapore market.

Singapore’s GST framework and its reach to non-resident vendors

Singapore’s GST is a consumption tax of 9 percent applied to most goods and services consumed domestically. The Inland Revenue Authority of Singapore (IRAS) administers the system to ensure tax neutrality between local and foreign suppliers. The Overseas Vendor Registration (OVR) framework was introduced to capture sales by foreign service providers and online merchants supplying to customers in Singapore.

Initially limited to digital services, the OVR regime was extended from January 1, 2023, to cover non-digital remote services and low-value goods (LVG) valued at S$400 (US$295) or below when imported by air or post. Vendors operating under the simplified OVR regime generally charge output GST on qualifying B2C sales and do not claim input tax; alternatively, vendors may choose to register under a full regime that allows input tax recovery if their structure supports it.

The OVR framework now forms a consistent part of Singapore’s approach to indirect taxation across digital and physical trade.

Determining when registration is mandatory

A foreign business must register for GST when two conditions are met within a rolling 12-month period. The first is global turnover above S$1,000,000 (US$730,000). The second is sales to Singapore customers exceeding S$100,000 (US$73,000). Once both thresholds are reached, registration becomes mandatory within 30 days.

Foreign businesses that expect to meet these thresholds in the near term may register voluntarily. Early registration helps reduce administrative delays and signals compliance readiness to Singapore customers.

If a business sells through an online marketplace, IRAS may designate the marketplace operator as the deemed supplier. That operator would then assume responsibility for collecting and remitting GST on those sales.

Business-to-business supplies to GST-registered customers are subject to the reverse charge mechanism. In such cases, the domestic recipient, not the overseas supplier, accounts for the GST.

Scope of transactions subject to GST

Under the OVR framework, GST applies to two broad categories of cross-border sales — remote services and low-value goods purchased by Singapore consumers. Remote services cover both digital and non-digital activities. These include software subscriptions, cloud hosting, online training, consultancy, design, and other professional services delivered from outside Singapore but used locally.

Low-value goods are also subject to GST if they are imported by air or post and priced at S$400 (US$295) or below. Higher-value or dutiable items fall under Singapore’s regular import GST rules.

Where e-commerce platforms are involved, responsibility for collecting GST depends on who IRAS designates as the supplier. In many cases, the marketplace itself is treated as the “deemed supplier,” meaning it, rather than the individual vendors, must charge and remit the tax on those sales.

Registration and reporting requirements

Foreign vendors register for GST online through the IRAS MyTax Portal. A local subsidiary is not required, although appointing a Singapore-based contact person helps with correspondence and recordkeeping. Registration depends on the completeness of submitted documents, and processing times vary based on verification requirements.

Once registered, vendors must submit quarterly GST returns within 1 month after the end of each reporting period. Returns are filed in Singapore dollars, and records must be retained for at least 5 years. Any credit notes or refunds should be reflected in the following return to maintain accurate reconciliation.

Because vendors under the simplified OVR regime are not entitled to input tax credits, maintaining detailed transaction records is critical. Many businesses use automated accounting or enterprise systems to handle currency conversions and streamline data reporting to IRAS.

Charging and remitting GST

GST is applied at the point of sale to customers whose usual place of residence or business is in Singapore. Customer location is generally verified through billing or payment details, and every invoice must display the vendor’s GST registration number together with the tax amount charged.

Once a vendor becomes liable, its billing system should automatically apply the 9 percent GST rate to Singapore-based customers. The amounts collected are then converted into Singapore dollars, reported through MyTax Portal, and remitted to IRAS every quarter. Clear invoicing, consistent reconciliation, and proper recordkeeping form the foundation of effective GST compliance and help reduce audit exposure.

Penalties and enforcement

Singapore enforces GST obligations firmly. Late payments incur a 5 percent penalty, followed by 2 percent per month until paid, up to a maximum of 50 percent of the tax due. Deliberate evasion or fraudulent reporting may result in fines of up to S$10,000 (US$7,300), imprisonment for up to 7 years, and penalties equal to 3 times the tax evaded.

IRAS employs data analytics and international cooperation to detect noncompliance. Failure to register when required may lead to retrospective assessments and fines of up to 200 percent of the tax owed. Businesses that voluntarily disclose liabilities before detection may benefit from reduced or waived penalties.

When and how overseas vendors should register

Deciding when and how to register depends on the sales structure and customer profile. A vendor crossing both registration thresholds must register under OVR within 30 days to avoid exposure to retrospective liabilities and to maintain operational continuity. Entities nearing thresholds may opt for voluntary registration to minimize transition complexity.

Vendors supplying exclusively to GST-registered Singapore entities may use the reverse charge option instead of OVR registration. Those selling through platforms must clarify whether the marketplace has been designated as a deemed supplier by IRAS, as responsibility shifts accordingly.

Each pathway entails different obligations and system requirements. Businesses should monitor their revenue and sales patterns quarterly through a rolling assessment and set internal decision triggers ahead of liability activation.

How different registration decisions affect compliance

The timing of registration has a significant effect on how smoothly a business manages its GST obligations. Companies that register early can integrate GST processes into their systems in an orderly way, maintain consistent reporting routines, and build predictable relationships with both IRAS and their customers.

Marketplaces that are treated as deemed suppliers follow a similar path. By consolidating transactions and remitting GST across multiple vendors, they simplify oversight even though the system setup requires some initial investment.

Businesses that register voluntarily also tend to gain from planning. Early compliance helps them meet client procurement requirements and avoid the disruption that can occur when registration becomes mandatory without preparation.

Those who delay registration often face higher costs and administrative strain. Retrospective assessments, penalties of up to 200 percent, and temporary restrictions on local payment processing can follow late compliance.

This article first appeared on ASEAN Briefing, our sister platform.