How to Hire the Best International Tax Experts in Singapore

When expatriates work or live in Singapore, one of the significant challenges they face is the complexity of tax issues. To handle this properly, it is necessary to hire an international tax expert.

In different situations, such as residing in Singapore as an expatriate while your employer is located overseas, holding overseas investments, or establishing your own offshore company, the related international tax knowledge is quite complex. Therefore, it is necessary to consult an expert specializing in Singapore’s international taxation.

The benefit of working with an international tax expert is that it reduces the risk of inadvertently violating the tax laws of your home country or Singapore. At the same time, an international tax expert can help you handle the procedures related to tax filing. More importantly, an international tax expert can help you plan the optimal offshore tax strategy.

While it’s undeniable that there may be professionals in this field in your home country, we still recommend hiring an international tax expert in Singapore. This is because, in the complex field of international taxation, Singapore’s international tax experts have more local advantages.

To hire the best international tax expert in Singapore, it is recommended to follow these steps.

Define Your Tax Strategy

As an expatriate working in Singapore, the first step is to define your tax strategy. Singapore operates on a territorial tax system, meaning residents are taxed on income generated locally. Additionally, foreign-sourced income received in Singapore is also taxable. In a globalized world, many Singapore residents naturally have income from overseas. When foreign income is remitted to Singapore, it may be subject to double taxation—once abroad and again when it enters Singapore. Determining the correct source location of a particular income can be a complex and contentious process.

Furthermore, if you are an entrepreneur who has established a company in Singapore, you are simultaneously working as both an employee of an offshore company and a business owner. In this case, you need to plan for both personal and corporate taxes. In some situations, such as when your business involves partnerships or your spouse works in the same company, the number of factors to consider in tax planning increases, and the difficulty of tax planning rises to another level.

Moreover, Singapore tax resident companies can enjoy tax incentives such as the Foreign-Sourced Income Exemption (FSIE) scheme, Unilateral Tax Credit (UTC), or Double Taxation Relief (DTR). The specific implementation details of these can likely only be navigated by experienced local international tax experts in Singapore.

By collaborating with an international tax expert in Singapore to create the best tax optimization strategy, you can save energy on tax matters and focus on maximizing your business development.

Understand Your Needs

Assuming you have already created an optimal tax optimization plan through collaboration with an international tax expert in Singapore, and now only the preparation of the tax return remains, do not let your guard down. It is a mistake to assume that tax filing in Singapore is similar to that in your home country and thus underestimate the difficulty of preparing tax returns.

If you work in Singapore as an employee of a foreign company, the situation is indeed not very complicated. You just need to fill out the basic tax return, and any issues that may arise can generally be addressed by any international tax service provider on the market.

If you have an offshore bank account in Singapore and engage in foreign exchange investments through it, the tax filing process is also generally not too complex.

However, if you run your own business in Singapore, engage in international investments, and also operate an offshore platform, and your business operations involve complex issues like transfer pricing, it is difficult for an ordinary tax consultant to provide the best tax optimization plan while considering all factors. Therefore, in such cases, the importance of hiring an experienced international tax expert in Singapore becomes apparent.

As an entrepreneur, you are adept at running your business and may feel that filing taxes for your business is not a difficult task. However, most tax consultants on the market only focus on the basics of taxation and have limited capacity to handle more complex corporate tax cases.

Firstly, entrepreneurs themselves are a small fraction of the population. If you have established multiple offshore companies in Singapore, have transactions with your home country, and your offshore bank accounts are continuously generating income, the combination of these circumstances means an ordinary tax consultant’s abilities are likely insufficient.

Hire an Expert

When dealing with complex tax situations, only a local tax expert can solve your problems. Working with a tax consultant of mediocre professional standard will only make simple matters more complicated, and complex matters will go from bad to worse.

You certainly don’t want to find that when you consult on international tax issues, the advice is always vague and fails to effectively solve your problems. In the worst-case scenario, they might even use terminology incorrectly.

There are many reasons why expatriates choose to hire tax consultants from their home country, some typical ones include:

“Our families have been doing business together for generations.”

—This is not a reflection of their capability. Don’t fall victim to the sunk cost fallacy with your international tax affairs.

“We have worked together for many years without any problems.”

—Having no issues with domestic taxes does not guarantee a smooth experience with international taxes.

In fact, under the guidance of a tax consultant with insufficient professional competence, some people may file their taxes for years without realizing they are doing it incorrectly. The Inland Revenue Authority of Singapore (IRAS) may not discover these errors immediately, but when they do years later, you could face a hefty bill, penalties, or even worse situations.

“He is a Singapore local and has dealings with foreign clients.”

—What kind of dealings are they? Helping an expatriate file taxes on rental property income is completely different from helping an expatriate entrepreneur with their taxes in terms of the policies, documents, time, filing process, and potential issues involved. Some may just see this as a part-time job to earn extra money and could even make mistakes in submitting the most basic tax forms.

Suppose you hire a tax consultant of mediocre professional standard who makes an error in submitting a form or fails to realize the need to report income from an offshore bank account. By the time you receive a penalty notice from IRAS and then consult a more professional tax expert to contest it with the tax authority, the time and effort spent could be far greater than if you had hired an excellent local international tax expert in Singapore from the beginning.

Stay Calm

In the initial stages of international tax planning, you might feel impatient due to a lack of relevant knowledge. Even if you have a long-term, trusted domestic tax agent, you know that continuing the partnership for international tax matters might be difficult.

So, you start consulting every possible international tax service provider online, communicating with others who have similar needs, or still clinging to a sliver of hope by asking your current tax agent if they can provide international tax services.

While it’s not entirely fair to say that a domestic tax agent will definitely do a poor job with Singapore tax filing, when your business has a certain level of complexity, a tax agent’s lack of expertise in Singapore tax law can be fatally dangerous. Due to their ignorance of how the offshore world operates, Singapore’s tax policies, and the tax filing requirements and deadlines for expatriates in Singapore, they may offer highly unprofessional advice. Such advice often goes in two directions:

1. They will tend to be very conservative and persuade you not to go offshore. You might hear them say things like going offshore is impossible, but whether it is possible or not, their suggestion stems from their own ignorance. Meanwhile, there are many simple and legal tax strategies that are actually feasible, but because they have never implemented them, they will advise you against them.

2. They will give you bad advice, which will cause you to lose trust in all expatriate tax consultants. They might say that overseas income must also be taxed in Singapore, so there is no need to leave your home country to develop in Singapore. When you find a professional international tax expert in Singapore and discover the series of tax exemption policies for overseas income, and you report this fact back to your domestic tax consultant, he may still stick to his opinion, claiming that the Singapore tax consultant is not professional, when in fact, he is the one who is unprofessional.

International taxation is inherently complex. What you need to do is find the best international tax expert who meets your needs. A tax strategy is like a medical strategy: two good doctors can have different opinions on how to solve the same patient’s problem, but both opinions can be equally valid. Therefore, once you have chosen a partner, you must give them sufficient trust and follow their advice to implement an offshore tax optimization strategy.

Set Clear Deadlines

Just as only good restaurants have queues, excellent expatriate tax experts are also very busy.

When hiring an expatriate tax expert, you should set reasonable expectations in writing from the very beginning. Tax professionals are very busy during tax season, and their time becomes relatively more available after it ends. The tax season in Singapore may differ from that in your home country, so do not make assumptions.

This means you need to be clear from the start about what you want to achieve, deliver your documents on time, and ensure that tax preparation can proceed in an orderly manner, even during peak periods.

Developing a clear strategy in advance and collaborating with an excellent and experienced local Singapore tax expert will help complete all tax-related work on time and in an efficient and orderly manner.

If you need to develop a Singapore offshore tax strategy for your business, or if you just want to have a simple consultation first, you are welcome to contact NCL at any time.