Singapore – Canada Double Tax Treaty

Singapore and Canada signed a treaty for the avoidance of double taxation on 6th of March 1976; the legislation provided by the double taxation treaty was applied accordingly until 2011, when the agreement was amended, by replacing several provisions that were outdated. Canadian investors interested in opening a company in Singapore can benefit of the provisions of the double taxation agreement signed by the two contracting states; our law firm in Singapore can provide you with an in-depth presentation on the main stipulations of the contract. 

 

 

The agreement between Singapore and Canada applies to residents (individuals or companies) who are tax payers in the contracting states. The agreement refers to the taxation of income in both contracting states. According to the treaty, the tax applies on the total or parts of the income. 

 

The agreement covers on the Canadian side the tax applied to income, and in Singapore covers the Singaporean tax. It is stipulated that the convention covers identical or similar taxes in the contracting states, as imposed by the local taxation legislation; our Singaporean lawyers can present to you further details on the taxes covered by the treaty. 

 

The agreement states that a “person” is an individual, company, partnership or a trust and any other legal entity that may be subjected to taxation. A permanent establishment refers to a permanent office set up by a company and it covers the following: 

 

• a branch; 

• an office;

• a workshop;

• a mine or quarry;

• a building site in which constructions last longer than six months.

 

 

Dividends that have to be paid by a company which is a tax resident of Canada to another company which is a tax resident of Singapore can be taxed in Singapore. Dividends paid by a Canadian company to a Singaporean company can also be taxed in Canada by applying the local legislation. If the beneficial owner of the dividends is a resident of the other contracting state, the tax on the dividends will be of maximum 15% of the gross amount of the dividends. 

 

Interest arising in a contracting state that must be paid to a resident company of the other contracting state can be taxed in the other state. 

 

If you need further information on the Singapore- Canada double tax treaty, please contact our law firm in Singapore for legal consultations.